eBay Marketing Terms Update: Are eBay's Ad Practices Facing Increasing Regulatory Scrutiny?
eBay has quietly updated their Marketing Program Terms page and while the changes are mostly minor, they may point to increasing regulatory scrutiny of eBay's Promoted Listings advertising practices.
Sellers were confused in January when they started seeing a banner announcement in Seller Hub about updates to the Marketing Terms, but when they clicked through, the page still showed the old terms that had been in effect since March 30, 2023.
It now appears that may have just been a premature alert as the Marketing Terms have now finally been updated, effective March 19, 2024.
As usual, we always recommend reading the full terms yourself, but here are a few important changes users should be aware of:
eBay's "Sole Discretion" & Increasing Regulatory Scrutiny
Most of the changes to language in various parts of the Marketing Terms are removing limiting terms like "in eBay's sole discretion", instead leaving the possibility of discretion and decision making more open and broad.
For example -
Old version:
eBay reserves the right in its sole discretion to suspend, terminate, restrict or reactivate your use of the Marketing Services (in whole or in part), without notice.
New version:
eBay reserves the right to suspend, terminate, restrict or reactivate your use of the Marketing Services (in whole or in part) without notice.
Old version:
eBay may, in its sole discretion, label any Ad as "promoted," "sponsored," "ad" or similar designation.
New version:
eBay may label any Ad as "promoted," "sponsored," "ad" or similar designation.
There are several other sections that include similar changes and in each case, the language has been updated in a way that may indicate certain decisions or judgements are not limited to being made by eBay alone.
While these changes may seem like minor legalese, it's unlikely eBay would have made them without good reason - and that reason may be increasing regulatory scrutiny of ad practices or that eBay is at least having to adapt to the idea that the evolving regulatory landscape means the increasing possibility of government agencies across the globe inserting themselves into policy, enforcement decisions and business practices.
That idea is bolstered by changes to this section, which previously had put the onus on sellers to make sure their ads comply with applicable laws and regulations but has now been changed to acknowledge eBay's responsibility for regulatory compliance.
Old version:
eBay reserves the right to decline to publish, delay the publication of, or remove any Ad or Content, in its sole discretion, for any or no reason, and without any liability to you or any other person.
You agree that this shall not relieve you of your responsibility to ensure compliance with all applicable laws, regulations and third-party rights. eBay reserves the right, in its sole discretion, to make edits to any Ad or Content.
New version:
eBay reserves the right to decline to publish, delay the publication of, or remove any Ad or Content.
eBay reserves the right to make edits to any Ad or Content (including, for example, to optimize size or formatting, to comply with regulatory requirements, to add marketplace functionality, etc.).
eBay is already dealing with increasing regulatory scrutiny on multiple fronts, implementing a Regulatory Operating Fee in the UK and some parts of the EU to address the rising costs of complying with regulations, environmental and consumer protection laws, and new tax and customs measures.
And in the US, eBay is also facing a historic $59 Million settlement with the DEA, ongoing litigation brought by the EPA, and a deferred prosecution agreement with the DOJ in connection to the 2019 cyberstalking of journalists Ina and David Steiner of EcommerceBytes that hit the company with $3 Million fine and enhanced compliance monitoring requirements, including a specific focus on Mergers and Acquisitions due diligence, disclosure and risk management.
It won't be surprising if regulators soon turn their attention to eBay's ad practices as well, especially with recent initiatives the included confusing popups and predatory dark pattern design to lead sellers into launching expensive cost per click campaigns they may not have intended to opt in to.
Liz Morton
Cost Per Click and Cost Per Sale Pricing
There were also several changes made to section on cost per click and cost per sale pricing.
For cost per click, eBay has added a specific call out for automated bidding features or other optimization programs, including dynamic pricing and "services that do not offer ad rate features".
Old version:
If you participate in the Marketing Services on a cost-per-click basis, you agree to pay an amount up to and including the ad rate reflected in your account settings (or as determined by your participation in optimization features, which may include ad rate automation) for each click on your Ad.
New version:
If you participate in the Marketing Services on a cost-per-click basis, you agree to pay an amount up to and including the ad rate reflected in your account settings (or as determined by your participation in automated bidding features or other optimization programs, in which ad rates may be applied dynamically on your behalf) for each click on your Ad.
If you participate in a cost-per-click Marketing Service that does not offer ad rate features, you agree to pay for each click on your Ad as described via that Marketing Service.
While they don't specifically define "services that do not offer ad rate features", this is likely in reference to Promoted Listings Advanced Smart Campaigns or other options which allow eBay to automatically select which listings to include "based on historical performance" and also allows them to set the bidding and targeting for those items with no direct input from the seller.
To be clear though, sellers do have to opt in to those types of campaigns or otherwise act to allow eBay to take this level of control over the ads.
This is not something eBay will do on their own unless/until the seller opts in, though, as noted above, in some instances there are concerning design practices that could potentially lead some sellers to opt in without realizing the full extent of what they are actually signing up for - as always, read the fine print very carefully before clicking any buttons to launch or accept a campaign.
For cost per sale pricing, eBay has notably removed references to VAT and GST, while still leaving reference to sales tax.
Old version:
If you participate in the Marketing Services on a cost-per-sale basis, you agree to pay an ad rate based on the total amount of the sale for each Attributed Sale (as defined below).
The total amount of the sale is the same value we use to calculate final value fees (described in the applicable eBay policies), and includes the item price, any handling charges, shipping costs, taxes (including, without limitation, sales tax, value added tax, and goods and services tax), and any other applicable fees.
New version:
If you participate in the Marketing Services on a cost-per-sale basis, you agree to pay an ad rate based on the total amount of the sale for each Attributed Sale (as defined below).
The total amount of the sale is the same value we use to calculate final value fees (described in the applicable eBay policies), and includes the item price, any handling charges, shipping costs, sales tax, and any other applicable fees.
The eBay UK help page for Promoted Listings Standard still says "any applicable VAT may be applied to your advertising fees", so it's not clear if this page has just not yet been updated or if eBay is in fact not changing how they handle VAT in regard to advertising fees.
We've reached out to eBay for clarification on that point and will update when/if we have additional information.
And finally, under the heading "Other Pricing Features" eBay has made a curious change that may foreshadow changes coming soon for Promoted Listings Express for Auctions.
Old version:
Marketing Fees applicable to additional Marketing Services (e.g.,time-based fixed price, cost-per-impression, optimization services, etc.) will be specified in writing or via the Marketing Services.
New version:
Marketing Fees applicable to additional Marketing Services (e.g., cost-per-impression, optimization services, etc.) will be specified in writing or via the Marketing Services.
Again, eBay does not precisely define "time-based fixed price" services, but Promoted Listings Express for Auctions charges a flat upfront fee that can vary depending on the length of the auction, which could logically fit within the idea of a "time-based fixed price" service.
"When you promote your listings with Promoted Listings Express, you’ll pay a flat fee upfront for access to sponsored placements on similar listing pages...Your Express ad fee will depend on the length of your auction-style listing and the category you select when listing your item."
Promoted Listings Express was first introduced in the US in 2021 as eBay's first ad product that allowed sellers to promote auction listings, later expanding to UK, Germany, Australia, Canada, and more in 2022.
But unlike other newer Promoted Listings options, Express has struggled to gain significant adoption or drive significant ad revenue growth for eBay.
CEO Jamie Iannone rarely mentions Promoted Listings Express for Auctions on earnings calls or in investor conferences as eBay actually dropped the option from their ad offerings completely in Germany last year.
Liz Morton
Since that announcement, we've been wondering if Promoted Listings Express might be discontinued sitewide eventually and if those ads are included in what eBay is calling "time-based fixed price" services, this Marketing Terms update would appear to make that even more likely.
For now, Promoted Listings Express continues to be an option according to eBay help pages for US and UK and we've also reached out to eBay for clarification on this point as well.
Checkout all the recent updates to eBay's Marketing Terms using the Internet Archive Wayback Machine Changes tool and let us know in the comments below what you think about the changes!
