CHIMERA WORKING PAPER NUMBER: 2006-08
Implications of eBay for ‘real networks’




The implications of eBay for ‘real netw...
CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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CHIMERA WORKING PAPER NUMBER: 2006-08
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The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
The implications of eBay for real networks': the distribution ...
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  1. 1. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ The implications of eBay for ‘real networks’: the distribution of goods, money flows and the Internet infrastructure of e-commerce Chimera Working Paper Number: 2006-08, January Ellis, R. M. & Haywood, A. J. rellis@essex.ac.uk & ahaywo@essex.ac.uk The growth of eBay into the world’s largest e-commerce site has been built on the back of three ‘real networks’ – those which deliver goods, those which involve money flows and an Internet infrastructure which allows the flow and exchange of data. The ‘eBay phenomenon’ (Bunnel and Luecke, 2000) has had interesting and complex implications for these ‘real networks’ which underpin the exchange of goods considered in this paper. The amount of items being sold on eBay has not merely put pressure on existing networks or increased their business, but led to complex negotiations by eBayers in terms of choosing between existing intermediaries and cherry picking their services, and substituting their business to new intermediaries which have grown up to cater for eBay and e-commerce. In addition, eBay is not only supported by the ‘real networks’ of distribution, money and an Internet infrastructure, it in turn has also supported them. Without eBay, for example, it is likely that many more local post offices would have closed (cf. Henry, Goswami and Young-Abraham, 2005) due to diminishing revenues from elsewhere in the business. eBay has also been one factor in encouraging the fast adoption of Broadband by eBay buyers, and is the ‘killer ap’ of Broadband adoption for eBay sellers – who cannot sell and list on a regular basis without it. eBay makes highly visible problems with existing ‘real networks,’ particularly with its globalising effects on the exchange of goods. Where no service exists to cater for eBayers’ needs, this often stops them bidding for such items and affects saleability – real networks affect what materialises on eBay and the ultimate destinations of eBay items. Using eBay gives people an alternative perspective on real networks, often through greater use and differential requirements to ‘non-eBay’ use. eBayers’ user perceptions of real networks are therefore also explored in this paper in order to understand the implications of eBay for those real networks, including their unmet needs. http://www.essex.ac.uk/chimera/
  2. 2. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ Chimera The work reported in this paper is part of the scientific programme of Chimera, the Institute for Socio- technical Innovation and Research at the University of Essex. Chimera is a post-disciplinary institute employing social scientists, computer scientists, engineers, anthropologists, psychologists, HCI practitioners and interface designers specialising in ‘socio-technical’ research and consulting. It was set up in April 2002 at Adastral Park, Suffolk as a research institute of the University of Essex. Chimera carries out research which combines the social and technological sciences to: • generate insights into personal and social use of information and communication technologies, • ground technological innovation in an understanding of people, • provide analysis to support evidence-based 'information society' strategies and policies in the public and commercial domain. We achieve this through a balanced programme of basic and applied research projects, consultancy and publication. For more information see www.essex.ac.uk/chimera Contacting Chimera Chimera Tel: +44 (01473) 632238 Institute of Socio-Technical Innovation and Research Fax: +44 (01473) 614936 Ross Building (PP1, ROS-IP) E-mail: chimera@essex.ac.uk Adastral Park, Web: http://www.essex.ac.uk/chimera/ Martlesham Heath, Ipswich, Suffolk, IP5 3RE UK Citing This Paper Readers wishing to cite this paper are asked to use the following form of words: Ellis, R. M. and Haywood, A. J. (2006) ‘The implications of eBay for ‘real networks’’, Chimera Working Paper 2006-08, Colchester: University of Essex. For an on-line version of this working paper and others in the series go to www.essex.ac.uk/chimera/publications.html © 2007, University of Essex All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form, or by any means, mechanical, photocopying, recording or otherwise, without the prior permission of the Director, Chimera. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 2 of 48
  3. 3. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ Table of Contents 1 Introduction – eBay and the ‘real’ networks .....................................................................................4 2 The distribution of goods .......................................................................................................................6 2.1 Royal Mail and Parcel Force – Impacts of eBay on mail and parcels ...................................................7 2.1.1 Perceptions of Royal Mail and Parcel Force ..................................................................................8 2.1.2 Customer experiences of Royal Mail and Parcel Force................................................................14 2.1.3 Unmet needs ...............................................................................................................................18 2.1.4 eBay and post interrelationships .................................................................................................19 2.1.5 Royal mail and customer views on future directions such as volumetric pricing........................22 2.2 Couriers ..............................................................................................................................................25 2.3 Local or face-to-face collection...........................................................................................................27 3 Money flows............................................................................................................................................30 3.1 PayPal .................................................................................................................................................30 3.1.1 Perceptions of PayPal..................................................................................................................31 3.1.2 Problematic aspects and desired improvements.........................................................................35 3.2 Other online payment methods: Bidpay, Nochex, Eggpay, FastPay ..................................................36 3.3 High Street banking services..............................................................................................................37 3.4 Cash in the post .................................................................................................................................38 4 Internet infrastructure of e-commerce.............................................................................................40 4.1 eBay and dial-up.................................................................................................................................40 4.2 eBay and Broadband ..........................................................................................................................41 4.2.1 Role of eBay in the take up of Broadband ..................................................................................41 4.2.2 Broadband and how it changes use of eBay...............................................................................42 4.2.3 eBay and marketing Broadband..................................................................................................42 5 Conclusions .............................................................................................................................................44 6 References ..............................................................................................................................................47 © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 3 of 48
  4. 4. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ 1 Introduction – eBay and the ‘real’ networks The growth of eBay into the world’s largest e-commerce site has been built on the back of three ‘real networks’ – those which deliver goods, those which involve money flows and an Internet infrastructure which allows the flow and exchange of data. The Human Geography e-commerce/ information economy literature has been important in dispelling notions of a new “weightless economy” (Quah, 1999) and the “death of distance” (Cairncross, 1997) in an information age - reinstating the importance of logistics (Murphy, 2003a, 2003b) for grounded, non-ethereal commodities; and the importance of information systems infrastructure in redefining geographies through the exploitation of minute differences between places (Li et al., 2001). At the beginnings of the eBay ‘phenomenon’ (Bunnel and Luecke, 2000), certain difficulties could be predicted for traditional upholders of these ‘real networks’, such as Royal Mail and the High Street banks. The Internet has often caused anxiety in terms of its implications for traditional networks – and that companies who did not commit to the new world order would be left behind (Karpinski cited Herschlag and Zwick, 2002). Electronic substitution was feared by carriers of post – with the rise of e-mail reducing household to household letter mail and replacing some business post. Meanwhile, High Street banks altered their working practices to accommodate the Internet – with online banking and the possibilities of BACS transfers. The Internet, in addition, often led to the rise of new competitors, who were unencumbered by traditional working practices which had been developed over years. It may have been expected that both the Royal Mail and the High Street banks would have been subject to intense competition from new incumbents in the market place in the form of private couriers for the distribution of goods and an electronic payment intermediary for money flows in relation to eBay transactions. It was also anticipated that Broadband could potentially be marketed through the benefits it would have for the ‘eBay experience’ as a potential ‘killer application’ to increase the adoption of Broadband services. Few of these predictions turned out to be true in 2005, as eBay.com reached its tenth anniversary. The decline in letter post caused by the Internet has been offset to some extent by the rise in e-commerce and eBay-related parcel and packet post. No single private courier emerged to take away the Royal Mail’s share of eBay post, although DHL’s Parcels2go is strongly linked to the eBay brand as a shipping solution for online auctions, having a stand at eBay University events. Customers still preferred Royal Mail, because of easy access to their network via Post Offices, and because of the inherent problems associated with private couriers (see Section 2.2), as well as cost. Ironically, eBay has potentially saved Royal Mail’s network of local post offices from closure, as a compensation for the government’s direct payment of pensions into bank accounts.1 For the High Street banks, the picture was different, and PayPal, their major threat in terms of eBay business in 2002 when the study was conceived, turned out to be more dominant than expected, partly because of a change in the eBay business model. eBay bought PayPal in July 2002, and then began to operate a ‘system lock in’ (Hax and Wilde, 1999) to using PayPal. eBay has tried to lock competitors out of eBay payments in a number of ways, including linking £500 worth of buyer protection insurance to its use, integration into the eBay checkout system and ‘outlawing’ the mention of some ways of paying, such as cash through the post, on eBay sellers’ item pages. PayPal has become part of the payment culture of eBay, and eBay sellers in the study have noted a reduction in other payment methods they receive (such as cheques), and few get paid via online banking transfers. The loss of chequing transactions will not affect the profits of High Street banks, as they do not charge private customers, and may be beneficial as counter staff would not be processing paid in cheques. However, in terms of revenue generating transactions, banks are certainly seen as the avenue of last resort for sending foreign currency abroad, and this is the area where substitution towards PayPal has occurred. Foreign currency transactions at a bank still require visiting a branch, filling out a form and considerable expense compared to PayPal’s arm chair payments and no fees for buyers. In terms of our third network, the Internet, during the period up to 2005, Broadband uptake in the UK has been very strong, and above the OECD average (see Section 4). Broadband users have been convinced of its benefits without the need for expensive advertising campaigns. For eBay buyers, being able to search quicker and snipe easier on Broadband was one factor in getting Broadband, while eBay was a ‘killer application’ in terms of subscribing to Broadband for regular eBay sellers. Many eBayers have already converted to Broadband. 1 Although the decision to phase out Post Office card accounts threatens them yet again. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 4 of 48
  5. 5. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ The paper goes on to explore in detail the implications of eBay for the ‘real networks’ of goods distribution, money distribution and Internet infrastructure. It also explores how the presence, absence or problems with these networks affects the saleability of eBay items. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 5 of 48
  6. 6. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ 2 The distribution of goods The advent of the ‘eBay phenomenon’ has relied very heavily on existing ‘real networks’ for the distribution of goods advertised on the site. Although ‘local collection’ is a part of the eBay landscape, and one which has become increasingly significant with the ability to search geographically and by post code (see section 2.3), most eBay items travel through the exchange process from seller to buyer via an existing distribution network of national carriers and private couriers. The Centre for Economics and Business Research revealed that £4 billion worth of trading was likely to be carried out on eBay this year, representing 1.3% of total retail sales, and that the auction site had particularly allowed people to realise the value of second hand goods they had sitting around in their cupboards (This is Money, 2005). International flows of material culture via these real networks are also a significant product of people using eBay to buy and sell. eBay is, of course, a global market place for goods, where sellers see selling globally as a way to expand their sales (Sinclair and Ubels, 2004) and buyers are taking advantage of eBay’s peer-to-peer global market for a number of reasons. The research reveals their primary motivations are to acquire collectables or other items from around the world which are not available in their own country (such as American radio sets or rare CDs). Buying globally is also used to defeat the ring-fencing of national markets, particularly taking advantage of earlier release dates of films in the US vis-à-vis the UK. Utilising global price differentials is also part of both collectables and new goods/ non-collectables purchasing on eBay, which increases the global flow of goods. Certain items, such as memory cards, are bought from the US because they are much cheaper there and postage is low on such items, while collectors in the study bought stamps or covers and radios because they were cheaper in the US for a number of reasons. Sometimes, US items are cheaper when offered for sale in the American market (eBay.com) because they do not have the rarity value there: I do look on the American sites and obviously find, I’ve got a lot of covers signed by Astronauts and Cosmonauts, you know. That obviously are a lot cheaper in America, because they live in America. Um, or they seem a lot cheaper in America than in this country. Um, and you know sometimes you get a price in your head, thinking: ‘It’s got to be 20-25 quid.’ But when you work it out, you know in dollars now, they’re selling for about five or six pound. You get this feeling: ‘It can’t be right, they can’t be selling a John Glen for five pound, when you’ve got to spend sixty or seventy pound over here.’ (Gordon, cover collector) Collectors have also taken advantage of newly opened eBay affiliate sites such as eBay Australia (eBay.au) or eBay New Zealand (eBay.nz) to get a bargain – searching there before other eBay collectors “eBay lookers” (Gregory, radio collector) realised that market had been opened up, and thus buying at reasonable prices because of the lack of competition. Finally, collectors have bought rare British items at lower prices from the rest of the world, because their rarity is not appreciated in that country, and often because other British buyers are put off by the perception of potentially high shipping costs. One radio collector bought a rare Chinese lacquer work Pye record player from the US for £100 plus £100 postage, when the same item would have cost £500 in the UK. High postage costs do not put people off buying globally if there is an overall saving. However, international eBay purchases do attract customs, duty and VAT charges over £18 for merchandise and over £36 for gifts. Those who deliver the goods (Royal Mail or private couriers) are also responsible for collecting this money. This can often be a shock for international purchasers the first time it happens, and certainly in the US there is the feeling that there is generally inconsistency in the application of taxation to Internet commerce (Nesbary, 2000) – the level of customs, duty and VAT to pay may depend on the description of the good on the customs form. They are also highly variable from country to country – in Canada the threshold is only $20 whilst in the US it is $200 (Sinclair and Ubels, 2004). Those bringing items into the UK via a private courier can always expect to be charged customs fees, eventually – whether phoned by couriers for credit card details or asked in a letter. Royal Mail appear to ‘sample’ the packages that come through, so eBay buyers can escape customs charges until they are picked. People resent having customs charges taken from them, and the Royal Mail or private courier as the agent of collection: © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 6 of 48
  7. 7. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ What is even more annoying is the Post Office charging you for helping customs to steal your money, because they’ve actually done this wonderful service for you and charged you for it. So that I do object, if anything would put me off from buying abroad, it would be the possibility of people getting hold of things and people wanting to charge me as they come into the country. That is just fundamentally annoying. (Richard, radio collector) The administrative fee Royal Mail and private couriers charge is also contentious, as seen above, and people also do not see why they should pay customs on second hand goods which are not affecting anyone’s jobs or being manufactured new abroad. Customs charges, as evident from Richard’s quote, are one element likely to dampen down international flows of goods (other than more obvious issues such as language difficulties, payment problems or poor perceptions of another country’s postal system). This is due to the extra cost, which may turn a bargain into an expensive item, but also because people perceive that customs have held up their goods through the postal or delivery system. 2.1 Royal Mail and Parcel Force – Impacts of eBay on mail and parcels National carriers such as the Royal Mail and Parcel Force seem, from our study, to have benefited most from the rise of eBay trade. The Royal Mail’s brand strap line recognises its role in e-commerce by labelling it as ‘the real network.’ Research by the Post Office in January 2005 showed 74% of people selling goods on eBay were sending them via the Royal Mail (Henry, Goswami and Young-Abraham, 2005). This is partly because small and medium scale eBay sellers often don’t have easy access to an alternative means of sending their items, and the Royal Mail’s near monopoly for certain types of post:2 “But Royal Mail is always there, you know. I suppose your hands are tied really - it’s like belonging to BT - you can’t use your computer without going through a BT line. It’s like tied to Royal Mail, there’s no other way, really.” (Sid, radio collector). Accessing couriers often requires a lengthy journey to an out of town industrial estate, or an account to be in place (for high volume sellers only) before they will pick items up: “The only thing about the Post Office is you have to take it down to the Post Office and that’s not such a problem. They’re [couriers] not very interested in the private person, they’re interested in regular business - firms such as Securicor and TNT, these sort of firms, want more regular business, they don’t want to deal with the little man..” (Arthur, radio collector). Local Post Offices provide easy access to the Royal Mail distribution network, and surveys in the media have suggested that eBay has helped some of them survive in a climate where some face closure. In a Sunday Telegraph survey (Henry, Goswami and Young-Abraham, 2005), out of 100 post offices contacted by the newspaper, 76 identified regular eBay sellers as a source of their rise in custom. 67 of the managers contacted said that more than half of the parcels sent from their store were the result of eBay, and another 8 identified eBay as the source of three-quarters of their parcels business. Nearly 70% of the post offices contacted by the Sunday Telegraph had earned an additional £1,000 to £3,000 a week from eBay sellers. eBay sellers, themselves, perceive the presence of other eBay sellers when they are at the local Post Office: “…if I’m in the post office, the local post office, and there’s like half a dozen of us with big piles of boxes and stuff, and we all look at each other out of the corner of our eye” (Alan, self employed eBayer) and also the impact of eBay on their own, often very small, local post offices: “Since eBay, they’ve [my village post office] been sending out a sack a day of, erm, purely items for eBay. It’s like a whole business.” (Focus group 2E). They also note the impact on the Royal Mail business in general: A: […]And how many thousands of items are sold every day on eBay? Do they actually let anyone know, in the UK? […] I reckon, daily, even in England alone, it must be in the tens of thousands. So how much money is that generating for Royal Mail. It must be an astronomical amount. (Focus group 3E) Local post office staff had also discussed the benefits of eBay for their business with eBay sellers: “actually a couple of the staff have told me how much better [South West] post office had done since they had started to get an influx 2 The Royal Mail has now been opened up to competition in business and consumer markets since 1st January 2006. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 7 of 48
  8. 8. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ of ebay sellers in the local area.” (Alan, self employed eBayer). Deutsche Post, the national carrier of Germany, has also seen eBay impact upon its parcels market. During the Christmas period, way back in 2003, 17% of all packages delivered by Deutsche Post were ordered through eBay (Libbenga, 2003). This rise in Internet-related postal revenue is ironic given the earlier fears by national carriers of the substitution effects of the Internet for letter mail. A report has shown that 67% of users who tended to send more than five e-mails a day claimed to write less letters because e-mails had replaced letter writing, with these figures based on a representative panel of more than 2500 individuals from 1000 households. Substitution of e-mail for letter writing was also shown to increase over the number of years of Internet use (Pasquini; Velardo and Vicario, 2002). While household to household letter sending has decreased because e-mail is more immediate, quick and convenient, small packet and parcel mail has increased with e- commerce - "bits become boxes" (World Bank and Universal Postal Union, 2001: 8), and are higher value post types. As Hanley et al comment (Hanley, Ozawa, Schmid and Wang, 1996: x) "electronic purchases nearly always generate some form of physical fulfilment - the sending of a package, confirmation letter, bill, or statement". eBay users were responsible for 5% of all person-to-person shipments in the US during the last quarter of 1999 (Anders cited Boyd, 2001) and Birch, Gerbert and Schneider (2000) note that eBay related items accounted for more than 15% of all packages delivered by the United States Postal Service in 1999. eBay initially led to its own stream of UK letter mail, with many UK buyers paying for items with a cheque through the post. However, cheques going missing in the post, and the concomitant lack of trust that ensues between buyer and seller over whether the cheque has actually been sent, has led to many more people using PayPal to send payment electronically: “But we’ve had a huge number of cheques go missing in the post. […] And it’s not uncommon. […] We … to the extent that we now prefer to pay Paypal if we can” (Martin, radio collector). Using PayPal to send payment, even in the UK, has become more part of eBay culture since eBay’s ruling that sellers cannot pass on surcharges for using PayPal to buyers, and since the introduction of the PayPal Buyer Protection Scheme, which requires PayPal payment to qualify for up to £500 ‘insurance.’ With this paradoxical increase in the parcel and small packet business for national carriers such as the Royal Mail, the project explored perceptions of both the Royal Mail and Parcel Force from a range of eBay buyers and sellers involved in the project. This included collectors of radios and audio items, stamp and cover collectors, self-employed eBayers and eBay buyers with various levels of eBay experience who participated in the project’s focus groups. They were encountering the Royal Mail and Parcel Force through the rest of their everyday lives, but eBay participation was increasing their contact with both organisations. Some eBayers even began to ask whether eBay itself was responsible for perceived pressures on the UK national postal system in this period: Do you think it’s a coincidence that the postal system seems to be falling apart in some way? Do you think eBay’s got anything to do with that? If it’s had a sudden impact? (Brian, radio collector) 2.1.1 Perceptions of Royal Mail and Parcel Force Perceptions of Royal Mail and Parcel Force during the fieldwork period were strongly influenced by two ‘Dispatches’ programmes made for Channel 4. ‘Third Class Post’ was broadcast on 29th April 2004 and the other, ‘Re-opening the Post,’ was aired on the 14th July 2005. Royal Mail subsequently complained to OFCOM that it had been subjected to “unfair treatment” in the first programme (Channel 4, 2004), and a joint statement was released from Channel 4 and the Royal Mail clarifying certain issues in the programme which were incorrect or mocked-up. Nonetheless, perceptions of Royal Mail and Parcel Force as organisations remained largely negative during the fieldwork period, partly based on footage from the ‘Dispatches’ programmes, and partly as a result of their own experiences as buyers and sellers. The fact that the Royal Mail had cut 30,000 out of 220,000 jobs during this period (Channel 4, 2004) may also have had an impact on actual experiences of those who were part of the study. The following represents a typical exchange about the ‘Dispatches’ programme during a focus group: © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 8 of 48
  9. 9. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ P: Often it’s not their fault. I mean, there was that Royal Mail programme on Channel 4 and I was horrified by it. B: We all were [laughs]. P: It’s like, now everything goes recorded delivery. Anything that’s over … B: Special Delivery on the floor and … R: I just sent something Special Delivery up to four hundred pounds the day before the programme [laughs]. ALL: [laughs]. P: Yeah, I was, I was really shocked by that. Erm, I actually just thought my God. Erm, I’ve always got a certificate of posting just in case, but I’ve also had a few buyers give me the run around recently, so… it’s …. no option really. (Focus group 2E) The ‘Dispatches’ programme is shown to be the source of considerable anxiety about the fate of eBay items sent through the post. eBay sellers amongst the group are shown to defer the perceived greater loss of risk by taking more precautions – definitely getting a certificate of posting but also using higher value postal services which offer insurance or a signed for element. This section explores, sequentially, negative and positive perceptions of Royal Mail and Parcel Force as organisations, before looking in detail at eBayers’ actual experiences of those organisations’ services. Royal Mail The perceptions that eBayers in the study have of Royal Mail are largely based firstly on the type of problems typically experienced with a large postal system – damaged items, missing items, and late post. However, there is also a perceived change in Royal Mail over time in terms of these factors. As mentioned in the introductory section of 2.1, it is perceived that Royal Mail systems are breaking down or cannot cope with the volume of mail it is currently receiving, increased by eBay trade, while they are still ‘touting’ for new business: “A: And now they have eBay, growing like a cancer… S: But they can’t deal with the amount of letters they’re dealing with. Their spending huge amounts of money getting people to send more letters, but they can’t handle the number their getting” (Focus group 3E). One of the most emotive problems which appears to cause extreme negative perceptions of Royal Mail by eBayers is when items, particularly rare collectables, are broken in the post: I detest Royal Mail. I absolutely loathe them. The whole lot of them are bloody muppets. They’re dreadful. I sent a beautiful bakelite radio to Ireland, the other week, and I wrapped this thing in layer upon layer upon layer of bubble wrap, I put it in a box, packed it round with newspaper, put that box inside another box which was also packed round with newspaper, sealed the whole lot up and sent it to Ireland. When it got there it was shattered. Even the dial was shattered. The only way they could have done that would have been to have thrown it, no other way it could have been done, and of course the man was distraught. (Arthur, radio collector) It is perceived that there is a general lack of care by Royal Mail employees, to the extent that items have been either thrown around, or as some quotations mention, used as footballs. This perceived lack of care is also regarded as perhaps malicious by some: I think the Royal Mail are all right for small things. I think when it comes to larger - we’re talking about the parcel service really - it is a definite fact that if you mark it fragile, it will get broken. Um, but you’ve got to mark it fragile any way, because if it does turn up broken, then the buyer’s going to say: ‘Well, you didn’t sort of say it was fragile?’ So, you’re in a no win situation. (Ian, radio collector) © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 9 of 48
  10. 10. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ Another serious negative perception of the Royal Mail amongst eBayers in the study is that they are ‘untrustworthy’. Partly this is about fragile items - that they ‘cannot be trusted’ with more delicate items - which has prevented eBay buying of such items: “I haven’t bought things like Bakelite radios, which are naturally fragile in the first place. So letting them loose with the post office isn’t a very good idea” (Oscar, radio collector). This lack of trust is also built up because of late and lost items in the post: I’ve had bills arrive that have been red. I’m thinking: ‘But you haven’t asked for any payment. What’s going on here?’ And I had more of those. If one hadn’t happened, it’s like anybody - you could forget these things. But I’ve had so much that hasn’t turned up, and you add that to stories of a chap I know up in Stafford. He used to subscribe to the Radiophile, but he gave up - because he was never getting the magazine. And we knew that they were being a bit delayed - Chas is a little bit erratic about publishing dates, you know. So Chas initially got the blame, but it was more likely that it was post office. As I say, I wouldn’t trust sending anything remotely breakable through the Post Office. (Oscar, radio collector) The Royal Mail is seen as ‘unreliable,’ often because of highly variable delivery services in particular geographic locations, which is in turn perceived to be because they “don’t have enough postmen” (Bill, stamp and cover collector) or because of agency or ‘inexperienced’ postal workers: “We’ve got this postman, who’s obviously just recently been employed as a postman, he looked like he had two brain cells to rub together. He stood on our doorstep, he’s muddling through our letters, dropping them - and you think Christ, of this is the type of person they’re employing, there’s no wonder they’ve got problems, you know” (Brian, radio collector). Royal Mail is also associated with problematic perceptions in terms of its accountability for loss or damage of post, and also the role and efficacy of its customer service department. The customer service department is perceived as offering no solutions or explanations – even when a parcel has a tracking number: “People abroad have not received parcels, although you’ve got a tracker number. They go on the website to track it, and they still haven’t received the parcel, you know. So Royal Mail, I’ve written to Royal Mail, complained - and they say there’s really nothing that can be done about it - they’re looking into it. That’s about all you ever get, you know” (Sid, radio collector). When insured items go missing, customer services are again perceived as unaccountable in terms of paying the actual value of the item. Many eBay sellers in the study have mentioned the fact that Royal Mail does not accept eBay end of auction pages as proof of value. With collectable items, it is very difficult to prove value, and eBayers believe this is Royal Mail trying to avoid their insurance liabilities: …mind you the Royal Mail are useless, when I post my jewellery by Special delivery insured up to £500.00, if it gets lost or delayed and you try to make a claim they ask for proof of value of the item, and a ebay invoice or receipt is not proof enough, so how can you prove its value if I buy the item at a fair and sell it for more then I paid, would I show that receipt and would they accept that ,(9 times out of ten I never get a receipt anyway ), and then I would not get enough compensation to cover what the bidder paid for the item ,I would be out of pocket, I think it is a very crafty system ,I am just lucky that so far my items were only late and showed up eventually, God only knows what would happen if a parcel did get lost. […] …every time I’ve tried to put in a claim, they’ve come back with some excuse. And it’s not good. I ask my customers to pay for insurance and tracking, because, as far am I’m concerned it puts their mind at rest, and as far as I’m concerned, I’m covered. And when you try and put in a claim, and they find any excuse not to. (Valerie, self employed eBayer) The perception that Royal Mail are trying to remain unaccountable is compounded for items which are not just lost but damaged. One radio collector talked about damaged items being sent back to Leeds in their original packaging, which for him added another layer of unaccountability for the Royal Mail – they could claim it had been damaged in this (uninsured) time of sending back: “But with the post office, you don’t get that. The post office want him to pack the radio up in its original packing, and send it to them in Leeds. […] Can you imagine doing that. And they also want him to send proof of its value, how can he do that with a vintage radio? Proof of its original posting, well I can do that, I’ve got that. And some other proof which was difficult to find, I can’t remember what it was now - four things. Now what a ridiculous system, which idiot thought this system up - sending stuff about that’s already been shattered, how do you know that when we send it to you, it isn’t at that time that it gets shattered, that it gets damaged. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 10 of 48
  11. 11. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ You send it back and it gets damaged. They could say, ‘It was OK before you sent it to us.’ What’s the point of insuring something of you’re not going to follow through on it. But they really are absolutely awful” (Arthur, radio collector). Royal Mail are also perceived as ‘passing the buck’ in terms of blame, back to the customer, for choosing an inappropriate service: “And the other thing is improving their complaint handling really, because if you send something by normal post - they say: ‘Oh, you should have sent it by recorded.’ If you send it by recorded, you get: ‘Oh, you should have sent it by registered.’ If you send it by registered: ‘Ah, you should have sent it by some other service,’ and they’re always quick to, you know, effectively bump the blame back on the customer because of the Royal Mail’s inability to do what they’re supposed to do. They’re - ‘if you send it by this service then you’ll get more compensation, or better handling, or whatever’” (Andrew, radio collector). The Royal Mail is still in a largely monopolistic position for the majority of eBay buyers and sellers too, even though it has been opened up to competition and has always had competition from couriers, and this quasi- monopolistic position is a second important component of the perception of the Royal Mail. As has been seen from the introductory section of 2.1, Royal Mail are compared by some to BT’s infrastructure – just as it is necessary to use a BT line to use the telephone or communicate, Royal Mail is another perceived ‘natural monopoly’ who has to be used with no other choice possible. And like BT, whose Brand is coloured by its former status as a nationalised industry, Royal Mail is also perceived to be in need of more competition to improve its services: W: I think the Royal Mail need competition. A: Competition? F: They haven’t got a very good […] right now. […] W: They have like, you know, Watchdogs and stuff like that, but unless they’ve got competition pushing them in, and like giving people a viable choice, then I think… (Focus group 2E) The perceived quasi-monopolistic position of the Royal Mail (“We are tied to these people, really,” Sid, radio collector) is particularly resented when things go wrong. People would like an alternate provider to turn to, but are not prepared to pay more: “If there was anybody else who’d deliver parcels outside the UK, without it being Royal Mail, at round about the same prices, I’d be grateful” (Valerie, self employed eBayer). Not all perceptions of Royal Mail are negative, however. Some people believe that damaged or lost items in the post are the result of poor packing or using the wrong addresses, rather than being the fault of Royal Mail. Royal Mail are also perceived relationally to private couriers, and often come out favourably when comparisons are made. They are seen as the cheapest way of sending items, and also much quicker at settling compensation claims: “It took me six months to get my money back from City Link. Whereas the Post Office when they’ve lost things, I’ve made two claims, and got that within a month, and without argument” (Derek, radio collector). One eBay seller found them more trustworthy than private couriers: …at the beginning I thought about using a private courier - but considering that the first and only item I sent by private mail - a piece of my artwork that was supposed to go to Portugal - wasn't picked up when it was supposed to be - got delayed at Heathrow - then got lost - then found again - I decided to use the post office. stuff has gone missing - usually in a strange void of Oklahoma and northern Texas - nothing ever seems to arrive in that whole area - very strange - but i do trust the post office - despite what people say. (Alan’s Blog, self-employed eBayer) Several eBayers were happy with Royal Mail and their service, because they realised the number of post items Royal Mail had to deal with, and the fact that they were sending and receiving items all over the world: © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 11 of 48
  12. 12. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ So far it has been amazingly good. As a buyer I can only recall one incident of damage - and that was down to the packing. To my knowledge nothing has gone astray. I have posted all over the world - and amazingly it has all got there - although it can sometimes take a long time. (Niles, radio collector questionnaire) One participant in the study recognised the influence the media has on perceptions of Royal Mail: “…but generally, if you ask me the question ‘what do you think of the postal service?’, I would’ve turned round and said, erm, ‘it’s OK - it’s not as bad as the papers make out’.” And, indeed, customers are extremely happy in relation to one aspect of the Royal Mail service – the local, regular postman or woman – because of the high quality personal service offered. However, when the local postie is away or people move to a different area, they perceive the service as again highly variable in quality: I live in a very remote area, in a village, we have a postal delivery by car, and Sue comes up in her little van, and if there’s no-one home, she puts it in the glass house and signs for it [laughter], and it’s such personal service. And that’s the thing about Royal Mail, it’s so inconsistent. I get the most phenomenal service where I live, and yet I know also that want I was living in other parts, when I was living in South Essex, it was very dodgy, a bit unreliable. (Essex focus group 3E) We find that sometimes that if we get a regular post person it’s brilliant, they know what they’re doing, they bring our mail promptly, usually first thing in the morning. We don’t wait until after lunch to get it, er, but if they’re off because they’re sick or having a break or something like that, we become second class citizens and that irritates because we’ve spent a lot of money with the post office and I think it was brought home to us that we sent out a very valuable document. (Clive, stamp and cover collector interview) In terms of perceptions of the Royal Mail, the relationship between a local, regular postman or woman is the biggest contributor to positive perceptions of the organisation. The local postie is known by name and has established a trusted relationship with individual customers in terms of the appropriateness of signing for items on the customer’s behalf when they are not at home3, and safe places to leave parcels (such as the greenhouse, above). When there is no local postie, this system is disrupted: “…because we know our Postman by name, but when he’s on leave you get the parcels left on the backdoor-step in the rain and all the rest of it” (Martin, radio collector). Local post offices are also viewed very positively. Many eBay sellers talk of the personal service they get from them, especially when they have a lot of parcels to send: PL: Although the village my mum lives in is in Wales, and it’s pretty good, actually, because it’s, erm, when I was there over summer, I used to be able to go in, like drop my stuff off and they would post it for me, stamp the certificate of posting, and I’d come in, like, later that day or the next morning, and I’d pay them. It’s a sub-Post Office so it’s slightly different. RW & RE: Yeah. PL: But they wanted the business because I was sending thirty-odd packages, so … and I didn’t want to queue up. RW: My village Post Office doesn’t mail …. I just like drop it off and they fill it all out for me, because they know us, because it’s a small village. You just fill out the address and they’ll do it. PL: I think they want the money, that’s the thing. It’s like, if it’s a sub-Post Office they depend on it. And I always get better service. 3 Which is technically against Royal Mail policy. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 12 of 48
  13. 13. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ (Focus group 2E) Local post offices are happy to accommodate eBay sellers, apparently, because of the extra business they produce. Some eBay sellers had built close relationships with their local Post Offices – some even saved boxes for their regulars, and this appeared to be part of a relationship of mutual assistance: …was at the post office today - as I am most days - and they gave me a load of boxes as I said that I was finding it difficult to get a variety of boxes for particular items. Wasn't that nice of them. I must admit - building up a relationship with your local post office is well worth the effort. [SW England] Post Office know when to expect me and when are my busy days - they even seem to know when I've had a good or a bad week. I have said this before - but the woman who served me yesterday said that so many services had been taken away from the post office - that eBay had been a bit of a saviour to them. considering that I suppose I must spend about £100 a week on postage - and I'm only one eBay seller - they must do pretty well out of us. (Alan, self employed eBayer) Parcel Force In terms of perceptions of Parcel Force, these are strongly interconnected with customer perceptions of Royal Mail’s standard parcel service, and are not strongly differentiated in people’s minds. As with Royal Mail’s carrying of parcels, the most negative perceptions of Parcel Force relate to items getting broken: Um, I have heard Parcel Force referred to as brute force by some sellers, and I did receive, from [eBay radio seller] actually, a very, very well-packed record player, and at some point, somebody in Parcel Force must have stood on the parcel, because the lid of the player had been pushed down far enough for the autochange spindle to go through it. (Richard, radio collector). There is considerable anxiety about sending items via Parcel Force, because of this reputation: “well I normally now just say, I’ll say look, ‘You pack it up, I’ll get it collected’, so you haven’t, you’re not at the mercy of, you know, Parcel Force, which is another element of eBay well, not concern me, but is a sort of a worry” (Philip, radio collector). And yet Parcel Force also has its supporters, amongst those people who have had no problems with it, and because it offers a very convenient pick-up service with Parcel Force 48, for customers shipping more than a parcel a week. Some sellers believe Parcel Force’s ‘bad press’ with breakage is more the result of people’s inability to pack carefully: G: I only use Parcelforce. RE: Yep. G: Erm, Parcelforce get a lot of stick… RE: Yes. G: … but that’s down to the people that pack the things. Whatever it is, if it’s packed well - and obviously you’re going to get some things damaged from time to time, it can’t be avoided. But packaging’s absolutely essential. (George, radio collector) This report now explores various customer experiences of Royal Mail and Parcel Force in relation to their eBay buying. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 13 of 48
  14. 14. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ 2.1.2 Customer experiences of Royal Mail and Parcel Force Customer experiences of Royal Mail are revealed to be highly variable in the study. As mentioned previously, having a regular postman or woman with local knowledge and a knowledge of your preferences in terms of where to leave post when you are out, versus agency postal workers, seems to lead to better customer experiences at the customer end. As one radio collector, Allan, put it: “And whereas the normal postman knows not to put letters through the letter box because the dog eats them, you can’t tell agency people that.” Geography also seems to play a part in the customer experience. Rural areas tend to have regular post men and women who stay in their jobs, rather than agency workers, but there are also post code variations, as this quote reveals: A: I live in a very remote area, in a village, we have a postal delivery by car, and Sue comes up in her little van, and if there’s no-one home, she puts it in the glass house and signs for it [laughter], and it’s such personal service. And that’s the thing about Royal Mail, it’s so inconsistent. I get the most phenomenal service where I live, and yet I know also that want I was living in other parts, when I was living in South Essex, it was very dodgy, a bit unreliable. S: I think it depends on the person who actually delivers your mail. A: Yeah, and the local sorting… I heard the other night that IP has got one of the best records, because I’m in the Ipswich area along with central Suffolk, so, the IP zone apparently has the best record in East Anglia, but if you’re CO it’s absolutely appalling and if you’re Chelmsford it’s absolutely abysmally poor there. So if you’re postcodes a CM or a CO, you’ve got much more likely to get poor service. (Focus group 3E) As has been seen above in terms of perceptions of Royal Mail and Parcel Force, receiving damaged items is the principle negative aspect of the customer experience mentioned by eBayers. As part of the study, two different collecting groups were interviewed – radio collectors and stamp/ cover collectors. These two groups have very different items to send and receive through the post in terms of their materiality – radio collectors tend to send and receive bulky, heavy yet fragile items via the standard parcel service and Parcel Force at high cost, while stamp/ cover collectors send and receive envelopes which fit through the door. It would be expected that radio collectors would have had worse customer experiences of damage than stamp and cover collectors. Indeed, many radio collectors did receive damaged items or send items which were received damaged. Often, they acknowledge this is due to poor packaging. However, some packaged their items with considerable care or received well-packed items which were still damaged: “I put massive red labels on the box, ‘extremely fragile, please handle with care.’ You might as well write it in Arabic because they take no notice, they can’t take any notice. Like I said, in this case and other cases I’ve had where damage has occurred, everything’s been boxed thoroughly, and yet the damage occurs, and I really don’t know how they could have done this particular radio because it was so well packed, it’s just hard to believe, and not only did they damage it, but even the dial was shattered.” (Arthur, radio collector). Big and heavy items are regarded as ‘difficult’ to post, and one radio collector had so many radios smashed he stopped collecting: “Have had several radios smashed by ParcelForce. At one stage, I stopped collecting because of this. Complained to them on several occasions, but little satisfaction. I eventually got compensation in most cases, but often after a lot of hassle” (Niles, radio collector questionnaire). Some radio collectors believed the last ‘local loop’ to be involved in a lot of the damage – when items went out for delivery or had to be redelivered: It does seem to suggest to us, that that’s where the bulk of damage occurs. I think if they can’t deliver it and they ring the door bell and there’s no-one there, they perhaps just sling it in the back of the van and couldn’t care less of whatever. […] That seems to be, to our point of view, to be where most of it happens. My partner buys quite a lot of bits and pieces on eBay - all sorts of odds and ends, you know not radio-related, just all sorts of bits and pieces, but as I say that goes to the PO Box, and again it nearly always survives. Whereas if stuff’s sent to home, it seems to have a worse survival rate. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 14 of 48
  15. 15. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ (Andrew, radio collector) While it was anticipated that radio collectors would have problems with damage, stamp and cover collectors were not immune. Often covers were folded, even when they were put in hardback envelopes by sellers and marked ‘do not fold.’ Automatic sorting also caused more problems for stamp/ cover collectors: H: Oh yeah, I mean you get these pretty envelopes that says ‘Please do not bend or crush’, you know, and er… […] I don’t know if it’s the automatic sorting offices or what but er, I’ve phoned the post office on several occasions about this and haven’t got anywhere RE: Yeah, did you get compensation for the damage? H: Er, I got one book of first class stamps. […] With a letter saying that the problem was from my local post office and not, you know, from the general sorting offices. […] And I told them at the time that was absolute rubbish. […] And they said they were going to reprimand my postman who I know quite well. […] And he knocks on the door and says, ‘Look [H]., I’m not putting these through the door - look at the state they’re in’ (Henry, stamp and cover collector) Missing post was also a major problem. One radio collector found that so much post was going missing, that he was having to get a certificate of posting to prove he had sent eBay cheques: Um, yes - it actually got to the stage where I actually thought I must be going mad. I mean I joke about it now, but I had so much stuff go missing, um, or things that didn’t arrive, I should say, that I sent - that I was really starting to think I couldn’t have sent it. This business of: ‘Oh my God, I’m going mad - literally!’ You know. And I was so convinced that I’d posted it, but so much stuff was going missing that I thought: ‘I can’t have posted it.’ It’s only since I’ve started using - always, when I send anything, I get proof of posting. Not because it means it’s worth anything. But at least (a) if somebody doesn’t receive something, you can, at least, say: ‘I did send you something, honest.’ If I’m paying for something on eBay and the cheque doesn’t arrive, at least I can prove that I sent them something. And also for me, so I know I’m not going mad [laughter]. (Oscar, radio collector) Oscar lives in a large urban area in central England, and some eBayers suspect that post going through large urban areas has something to do with going missing: “I do notice that when post does go missing it always seems to be London for some reason” (Alan, self employed eBayer). The reasons for the post going missing are largely opaque to the customers. Sometimes they feel this is nothing to do with Royal Mail – a result of bad handwriting on the parcel or even buyer’s fraud – declaring that they haven’t received an item in order to get another one. However, some stamp and cover collectors had their suspicions about why items had gone missing, although unproven: W: […] In fact one month I didn’t have any covers sent to me although I’d ordered, and then I asked the post lady, and she said to me: ‘I don’t know, but there is somebody I know, that works at the post office, who is interested in first day covers. R: Oh no. W: So perhaps they’re being intercepted. Funnily enough, a month later, all the covers that I had were popped through my door. Not on a post day, but on a Sunday morning. R: That’s very suspicious. W: Yes it was. Yes it was suspicious. But everything seems to be going OK now. I don’t know if the person left, or realised they’d been rumbled or what. Yeah, so. But otherwise, everything otherwise seems alright. (Wendy, stamp and cover collector) © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 15 of 48
  16. 16. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ The fact that postal workers were often interested in stamps and covers made stamp and cover collectors more suspicious about the whereabouts of missing items (although theft wasn’t proven), and many had experienced missing items. One collector had bought an entire collection from someone in Dover, which was sent by registered post, only to have it go missing at before its final destination. The collector was able to talk to a supervisor on the mail train, and the missing collection turned up late the following day. Stamp magazines also regularly went missing until they were wrapped in a grey covering, and one collector spoke of interference in the contents of her mail where a special label was removed and the item resealed. Sometimes theft of post occurred which was categorically nothing to do with Royal Mail. University students were particularly vulnerable to getting post stolen in multiple occupancy accommodation with open access pigeon holes, or student houses – and they would be unaware of the point at which the theft occurred. Often items which people fear have gone missing eventually turn up late, and various forms of late post were a negative part of the customer experience. One radio collector, Henry, reported his experience: “…yes I sold some magazines to a chap in London a couple of months ago, er, and it took almost a month, it actually took three and a half weeks, nearly four weeks to get to him.” Another eBay seller sent some kilt jackets with £100 insurance through the post, which took two and a half weeks to be delivered. But complaints about late post also concern getting deliveries late in the day. Royal Mail have merged the first and second delivery, and many eBayers report getting post late in the day: Because we’ve got security locks and our security locks here are off for two hours in the morning - quarter to seven ‘til quarter to nine - to allow the post in. Well, in the old days, they used to come in, and we get our post here, what, half seven at the latest. And now, well, I’ve had the buzzer go at half past two on a Saturday afternoon - ‘Yes, who is it?’ ‘Postman.’ And this is happening now every day of the week. (Wilf, stamp and cover collector) Some reported getting no post at all on some days, because they are considered a low volume round, and this is perceived to be exacerbated by the loss of their regular post man: B: Er, in general I’ve had very good experiences of the post, except here in Macclesfield we have a problem in that we don’t have enough postmen. […] And so we go days without post. […] And if you ring up and say ‘Where’s my post?’ they say ‘Oh you’re low volume round and it won’t be delivered until tomorrow’ RE: Oh I see B: And we have missing days. […] Er, and we don’t have the concept of our own postman RE: You don’t have.. B: And so it’s nothing to do with eBay and nothing to do with collecting, it’s everything to do with the way the post office delivers its mail RE: Yes, so you don’t have a regular postman who you can.. B: Well we did but er, he broke his leg or er, he was a young athletic guy who played football and he broke his foot or his leg, and then we ended up having stand-in postmen while he was off for months on end, and we’re still on this thing so our mail comes mid-afternoon but delivered by whoever feels like delivering it after they’ve finished their own work. […] And er, if there’s not very much of it, it doesn’t come until the following day. […] And the longest we’ve ever been is three days. (Bill, stamp and cover collector). Customers take a very dim view of having no post on a particular day, and some even feel they are being lied to when told they have no post, because they usually receive large volumes: “…what irritates us is when they turn round to us and say you haven’t had any mail when we know damn well we have because we know the sort of, we know that we get it is an exceptional day if we don’t get a single piece of mail” (Clive, stamp and cover collector). © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 16 of 48
  17. 17. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ Many problems eBay buyers and sellers reported, occurred at the postman/ woman and customer interface. Some of these involved simple delivery problems, such as delivering to the wrong address, especially when redirections were in place. Customers never knew if these items had been put back in the post box for redelivery, even though opening post not addressed to you is a crime. Most problems occurred with ‘inappropriate’ leaving of mail. One stamp and cover collector, living in a London block of flats, found mail abandoned near the building’s lift: And we’ve also come out, we’ve found the mail when we’ve gone out, the door at the end of the corridor to go to the lift, there’s mail stacked up outside the lift door. […] I’ve walked out the door to go down the corridor, and our mail’s just been pushed, the whole lot of it, under the door. […] No, I mean it’s just unbelievable. (Wilf, stamp and cover collector) For those living in individual dwellings, inappropriate leaving of mail when people weren’t in was a common occurrence. Some reported high value items being left visibly in porches in urban areas. Sometimes items have been left outside, exposed to rain: “… sometimes they leave, leave things at the back of the house, and they did that with one of my boxes of Jiffy bags and it absolutely tipped it down, and luckily it had the box to protect it” (Focus group 2M). This was seen as particularly inappropriate for ‘signed for items’: “Well, my best experience, so far, is the postman chucking stuff over the back garden fence and it falling behind the flower pot. And he chucked two letters over there that were meant to be signed for.” (Focus group 2E). People also resented ‘signed for’ items just being put through the letter box. At least three people interviewed had items delivered to their work address because of ‘inappropriate leaving of mail.’ If people are not at home, and no ‘appropriate’ method of leaving mail has been established (although this is technically against policy), such as putting items in a greenhouse or hidden area, then they believe a card should be left. But people often resent receiving a card through the door, which may mean a long and difficult trip to the sorting office for those without cars. Some students have even left it too long to pick up items, and they have been returned to sender. However, one respondent in the study received a card through his door when he was at home, with no knock at the door: J: We’ve found the opposite, where… T: Too many cards. J: No. We’ve actually been sitting there are watched the chap call, come and put a card through the door and get back in his van and drive off… M: Oh yeah? [Loud group laughter]. J: So what’s happened there, it’s quicker for them to go round and put cards through, and then everybody goes and picks them up. L: They don’t expect people to be there. (Focus group 2M) Another respondent reported that her post man or woman did not leave cards, so she had to trace back an eBay item when it didn’t arrive: “No, I have to know I’ve ordered something from eBay, it hasn’t arrived, check with the person that they sent it, and then phone the sorting office” (Focus group 2M). In terms of the customer experience, which is exacerbated for eBay buyers who are receiving a lot more mail than previously, procedures need to be followed rigorously for the customer to have a good experience of mail. ‘Appropriateness’ of leaving also needs to be established with individual customers if possible in terms of where items can be left and if customers would prefer it if they were taken back to the sorting office for security reasons (although this is against policy). However, it is difficult to see how this knowledge might be transferred to temporary post men and women. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 17 of 48
  18. 18. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ In terms of the eBay postal experience, international mail warrants its own section. Many people are now receiving international mail regularly, bringing items unavailable in the UK, collectables and items which are significantly cheaper than available on the UK market. In terms of items going missing, people do not perceive that international mail goes missing more than domestic mail. However, the US post is regarded as a major culprit for lost post: “the US is really bad for lost post though. the UK post office will blame the US post office for lost mail and the US post office will blame the UK” (Alan, self employed eBayer). Alan also notes “strange void of oklahoma and northern texas - nothing ever seems to arrive in that whole area.” The US post is also regarded as being slow compared to the Canadian or Hong Kong post. But, people often report they have lost no international items when they have lost several domestic items. There is also the perception that international post is often more carefully handled than domestic post: I mean, I do get the sense that things get bashed about less in the international post than they do in domestic. […] Yeah, it is, but you know, if you just look at the state of the external packaging when it arrives. […] Er, very often it’s, it’s corner’s mashed when it’s come from 20 miles away, but when it’s come from the other side of the world it’s in pristine condition (Henry, radio collector) 2.1.3 Unmet needs eBay buyers and sellers in the study were asked if they had any unmet needs in relation to eBay and the post. Some of these were highly predictable in light of certain negative customer experiences of post, and Royal Mail’s recent change to one delivery a day. The first involved trying to prevent damage to the items in the postal system, and it was believed that this could either be achieved by more training (“And I think if anything could be improved, I think it would be training, I suppose. But it’s such a big organisation, and a parcel goes through so many parts of the network before it ends up at the buyer’s address, that it could be damaged anywhere along the line. So it could be difficult” (Ian, radio collector)) or just being told to take more care – although mechanisation was also thought to be to blame for damage: Well, yeah I mean it can be, obviously if it’s in cardboard packages with ‘Please do not bend’ I mean, I think more care should obviously be taken, but I don’t know if it’s, you know, because most things are automated now, it just sort of you know, slides on down the conveyor belt and gets bashed at the end as it goes round the corner or something like that […] Or the amount of mail that’s on the conveyor belt, or is it manually thrown around I don’t know. (Henry, stamp and cover collector) People also want more accountability and traceability as part of a standard service, rather than having to use Special Delivery as part of higher value services. One of the eBay drop shops interviewed only used Royal Mail for a few items vis-à-vis couriers, because of a lack of track-ability for the basic services: “Trackable is absolutely important. […] Royal Mail, we sometimes use them. Erm, but in terms of customer service there is no track-ability” (Donald, eBay drop shop). A stamp and cover collector, Wendy, also commented that she’d like her post earlier in the day – since the change to one delivery a day, she was receiving post much later, and felt aggrieved that this could be as late as 5pm. In terms of more novel suggestions, eBayers wanted more integration of eBay and Royal Mail services, so that adding postage to an eBay end of sale happened in a seamless way, like paying via PayPal: J: They [Royal Mail] could - the way that eBay and Paypal have integrated themselves, um, to do that would make life a lot easier if they built that process, so when the sale finishes, automatically e-mails are going off and you could just check the e-mail and it’s taken the money out of your bank account, paid the guy and everything. That process is absolutely brilliant. There’s absolutely no reason at all why they couldn’t join forces with someone like © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 18 of 48
  19. 19. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ Royal Mail, for ready reckoners, label printing, for all these sorts of stuff. And also, if it’s a large item, you could arrange for Parcel Force to, you know, come and pick the thing up. R: So just have it as an integrated system? J: As an integrated system. (Focus group 3E) Such a potential service was likened to Screwfix’s (the mail order DIY company’s) delivery services – next day, seamless delivery. This idea was replicated across two of the focus groups. In one focus group discussion, it was suggested that Royal Mail should move quickly to integrate with eBay, otherwise other competitors will move in: “Now why eBay hasn’t got their act together and done a deal with Royal Mail, Royal Mail are going to lose out big time, if someone says: ‘We’ll provide that level of service, and we’ll do it at a very discounted rate’” (Focus group 3E). During our steering group meeting, a Parcel Force representative confirmed that the company was planning more integration with eBay. Another desired improvement was suggested by a stamp and cover collector, Mark. Mark collects high value stamp and cover items and buys from around the globe, but mostly from the UK, importing to the US. He also sells surplus parts of his collection. Mark can only get insurance up to $44 when buying stamps from the UK. Finally, an unmet need that was specific to eBayers was that an eBay invoice or receipt should be seen as proof of value for insurance claims with Royal Mail: The other thing is, of you take out compensation as I do with anything, I think the parcel is insured up to £20 or something like that, but then you can by insurance on top in different stages, er tiers. Whatever the item has gone for on eBay, you know, I’ll make sure the item’s insured to cover that amount. The problem arises though, if you do have to make a claim, the Royal Mail are very funny about the prices realised on eBay, and is that the value of it? […] Um. So I think they need to be a bit more flexible, um, I think on the one item I had to claim in that respect - I was very lucky that I actually had the receipt. And funnily enough, when I got the receipt out, I was rather surprised to see it was actually worth slightly more than what it went on eBay. So um, that went on and they couldn’t do anything. They actually had to pay out more in the end, so I was quite pleased about that. (Valerie, self employed eBayer) It is notoriously difficult to establish value for many collectable and older items, which is ultimately why many are auctioned on eBay (cf. Smith, 1989; Pinker, Seidmann and Vakrat, 2003) in the first instance. Many collectable items do not have price guides, and do not come with receipts from previous owners, since they have been in people’s collections for years. eBay sellers have a liability with eBay buyers in terms of recovering the cost of their item with Royal Mail. If buyers have paid for insurance, they expect to be compensated for the amount they have paid for an item. With some PayPal payments, eBay sellers may have to pay out compensation for a lost or damaged item before Royal Mail pay them, and thus they are left exposed to any valuation disparities or problems. If it is true that Royal Mail does not take eBay invoices or receipts as proof of value4, then this is in disparity with a number of third party insurers who have grown up to reinsure the postal market. This includes one which works in tandem with auctionsniper.com, which eBay buyers use to ‘snipe’ items, and DSI (Discount Shipping Insurance). These only reinsure certain carriers (and not the Royal Mail), such as UPS, USPS and Fedex, and therefore mostly insure the US to UK postal market). They accept eBay valuations as proof of value, since they have largely arisen due to eBay trade and the problems of being unable to insure letter or small packet items cheaply via USPS. 2.1.4 eBay and post interrelationships 4 Our Royal Mail steering group member could not confirm or deny this, but acknowledged web page print outs were open to being fraudulently constructed. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 19 of 48
  20. 20. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ There are several direct interrelationships between eBay and the Royal Mail postal system, where the post intercedes in the eBay exchange process. At its most basic level, postal problems or their perceptions can stop people selling (or buying) on eBay: S: It’s a residential area, it’s a cul-de-sac off a main road, in a block of flats, but… A: But that’s the worst scenario, isn’t it. S: But at the moment, I’ve moved house, and I’ve moved from number 27 to 37 [laughs]. I’ve done a redirection thing, and the postman keeps seeing things addressed to 37, and through the redirection, and being helpful and still thinking I live at 27, put them through the door of 27, and things like that. I can’t sell anything until this has been sorted out, I daren’t even sell because I just won’t get any payment. And it’s just that kind of thing. (Focus group 3E) eBay buying and selling requires a high degree of certainty about addresses and items being delivered to the correct address. The post and postal pricing structures also have an impact on what materialises on eBay, and weight is the critical factor. 2kg is the break point for international post. If items weigh over 2kg, they are very expensive to post abroad: Er, for instance we don’t sell anything that costs over 2 kilos worldwide because it just costs an enormous fortune to send […] And you know, the buyers won’t buy it so, if we had a big tea set of china we would split it up into small packets that would cost less than 2 kilos, er, because of the postage rates. (Helen, partner of self employed eBayer) Some items, however, cannot be split up so conveniently (such as radios), and high postage costs in the UK often put off international sellers, unless postal costs are not specified at the outset, when the buyer either absorbs the cost or backs out. Sellers believe Royal Mail’s prices are high: “I know they would say that their prices are reasonable, but it’s noticeable for example, er, the cost of sending any given weight from the UK to somewhere else is generally a lot more than doing it in the reverse direction” (Henry, radio collector) and that high postage costs affect the saleability of their items considerably: A: […]And it was so heavy, I couldn’t possibly post it. He wanted to pick it up anyway. When you’re selling a heavy item, I think it affects your prices. S: It puts people off. I mean I’ve sold books and often, because I start them all off at 99p or something, and, some computer science books cost £40 new or whatever, you know, normally you expect the price to go up quite a lot and normally it does. If they’re heavy, and the postage you list at £5, then nobody bids. Either because they don’t want to pay, or because they think it can’t be accurate, so they don’t trust you. (Focus group 3E) Postage costs intercede in the relationship between buyer and seller, and particularly interfere with trust, even when they are genuine. This is because postal charges are notoriously used to increase profits by eBay sellers – to cross-subsidise a low starting price to make an item stand out, to cover PayPal fees, or just to catch out the unwary. Although eBay disagrees with profiteering by postage, they believe postage must be agreed between buyer and seller before the end of a sale, and do not take action against profiteering which is only revealed when an item arrives with a post label showing that it cost considerably less to send than stated: “It’s my big gripe is that, ripping people off with packaging whilst you know as a seller you look at it and think: ‘I know how much it costs to package and sell, it is not £5.’ It is not £5. It will cost you a pound fifty to post, and probably 20p to package it. And I get really annoyed with people ripping off on packaging, and not putting down postage and packaging in the description, and only finding out what it is after, I’m very scrupulous about that. I’ll say: ‘This is going to cost this.’ I always tell people what it’s going to be” (Focus group 3E). For heavy and bulky items like books, or sending items abroad, actual postage costs are expensive, but may be misinterpreted as profiteering. As a result, some sellers try and keep postage prices to a minimum: “If it’s cotton, laundered and a little blouse it’s © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 20 of 48
  21. 21. CHIMERA WORKING PAPER NUMBER: 2006-08 Implications of eBay for ‘real networks’ going to be 50p. So I tend to do that, and do I try and keep it low though, because I know it does put buyers off” (Tamsin, self employed eBayer and vintage clothing seller). As can be seen from postage profiteering, the post is an intermediary between buyer and seller, and is used as another ‘actor’ in the exchange process to ‘obfuscate’ the actual price people will pay. The post is also used to create ambiguity in other circumstances, such as when as item is damaged: I wouldn’t buy anything without a picture, I mean, sometimes the er, picture on eBay looks like it’s cover in very good condition and when you buy it it’s got sort of like a slight corner knocked or something like that. […] When you get it but there again sometimes especially with the post you don’t know if that’s the post, or if that was the case if that was advertised on eBay, and that was the actual picture and it did have a slight sort of bend on the corner (Henry, stamp and cover collector) eBay sellers can pass off damaged goods as being in perfect condition before sale, in some circumstances. Buyers then cannot complain to sellers without them potentially blaming the intermediary – the Royal Mail. The post can also become an agent in seller’s fraud or buyer’s fraud. A stamp and cover collector, Frederic, bought an old photograph of a football club on eBay, but never received it after the eBay seller claimed it got lost in the post: And I won the auction, and I got an e-mail after the auction from someone, saying they made a mistake, they meant to bid on that lot, but for some reason they didn’t and it ended, and whatever reason it was, and could they buy it off me? So I replied: ‘No, sorry, I actually want it.’ But then miraculously, the seller never actually sent it to me, and claimed it had got lost in the post. I suspect what happened is that this person who wanted to buy it, contacted the seller direct, offered him a lot more money for it, and therefore the seller made up some excuse of why they didn’t sell it to me. (Frederic, stamp and cover collector) The post was used to obfuscate the fraud, by being another agent in the exchange to blame, and can also be used as an excuse for delays while sellers disappear with the funds. Buyer’s fraud also occurs, where buyers claim items are lost or broken by the post, demanding a refund: …had a problem with postage. a US customer had one parcel delivered but the other one hadn't turned up. i did offer her a refund if she was sure that the items were lost in the post - she waited a few days and then asked for a refund. i don't like these situations because i don't like letting customers down, but you also never know whether to believe the customer or not. i have read horror stories from sellers - on the notice boards - about dubious buyers with lines like 'the item got broken in the post and i want my money back' - and when sellers ask for some kind of proof of the broken piece - a photo for example - the item was thrown away in disgust by the buyer and the bin men have already taken it away - wheres my refund? hmmm. (Alan, self employed eBayer, blog entry) The eBay community boards report instances of buyer’s fraud (see Appendix, Figure 1). Sellers are advised to always obtain a certificate of postage, and to not refund before Royal Mail have refunded them. However, this is complicated by claims to PayPal for a non-delivered item – refunds have to me made by the seller for non-trackable items upfront. But the community pages also raise the question of what happens if Royal Mail in turn suspect buyer’s fraud, and whether Royal Mail have a ‘traceable’ system for non-recorded delivery items in order to identify buyer’s fraud.5 Indeed, it is unclear to what extent the Royal Mail suffers financially as a result of buyer and sellers’ fraud. The sellers may operate the fraud without claiming for the loss – merely supplying a refund as they have received more money from a second buyer. Buyer’s fraud is more likely to involve claiming back from the Royal Mail, although the seller may refund the buyer before the 5 From our steering group meeting, the Parcel Force representative suggested that non-recorded delivery items were not traceable in the postal system. © 2007, University of Essex http://www.essex.ac.uk/chimera/ Page 21 of 48

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