Are eBay Sales & Discounts Real Deals or Deception?
eBay is pulling out the stops with end of quarter discounts from major brands in the Brand Outlet hub to try to goose Q3 GMV, but just like their recent Labor Day sale, fake discounts using strikethrough pricing manipulation abound unchecked.
Liz Morton ~ Founder
Now through September 25, buyers can get an "extra" 20% off select brands using coupon code SAVE20EXTRA, but look carefully because many of these deals aren't so great after all.
eBay removed the link to sold history from the view item page earlier this year, making it harder for buyers to do their own research to discover fake discounts and spot shady business practices.
Liz Morton ~ Founder
Luckily, you can still manually check the sold history of any item - all you need is the item number, which can be found on the listing page itself or in the URL for the listing page.
Just copy and paste https://www.ebay.com/bin/purchaseHistory?item=xxxxx into your browser and replace the xs with the specific item number of the listing you want to view.
Let's take a look at some of the deals in this week's Brand Outlet sale.
First up - repeat offender, Dyson.
Dyson is currently showing this vacuum at $314.99 supposedly marked down from $419.99 for a $105.00 25% discount. Add the SAVE20Extra coupon and the final price would be $251.99.
But the history shows not only has this item not been priced at $419.99 any time in the last 3 months, it has consistently been offered lower than the current price of $314.99.
In fact you could have bought it for $249.99 with no coupon needed just 4 days ago!
This Lenovo laptop currently shows a price of $853.64, a supposed 42% savings off the $1,471.99 list price. With the 20% "extra"discount, the final price would be $682.91
The history shows it was $634.99 in July, all the way down to $434.99 in August and unconscionably, they jacked the price up to $853.64 before claiming to put it "on sale."
And it would appear Reebok has no qualms about using misleading strikethrough pricing to present false discounts either.
Reebok says these shoes are a 50% savings, marked down to $44.98 from a supposed list price of $90. With the "extra" 20% off, the final price would be $35.98.
History shows no previous sales at $90. In fact, you could purchase them for $35.98 without a coupon just 3 days ago - the price conveniently went up exactly the amount needed to cover this supposed "extra" 20% off on the exact day the "sale" started.
I wonder if eBay has also agreed to remove any negative feedback Reebok may receive from buyers who are savvy enough to figure out they've been duped?
For those who don't remember, in June 2019 the official Reebok store on eBay had a major pricing error event with some items marked down 90%+. Neither company ever publicly gave details of what caused the snafu or which party was to blame.
Chaos ensued as soon as news got out across social media and deals websites with buyers looking to snag a deal flooding the site, many of whom were hoping to cash in on the opportunity to resell the products at higher prices. Some buyers reported their items did in fact ship, but it didn't take long for Reebok to catch on to what was happening and start cancelling orders.
Reebok received literally thousands of negative feedback ratings due to the debacle and eBay furiously scrubbed their account to remove the negatives as quickly as possible.
Liz Morton ~ Founder
This strikethrough price manipulation is nothing new on eBay of course - it is absolutely rampant on the platform and is easy to find, especially in the Brand Outlet hub.
Many of these brands have special agreements with eBay to participate in Daily Deals and other promotional programs, with eBay often subsidizing all or part of the discounts being offered.
Since eBay does not stock or sell any products directly, offering subsidies and incentives to these brands is the only way eBay has to get in-demand brands and items on the platform at enticing prices.
That creates a serious conflict of interest as eBay gains financially from the arrangement, thus having less incentive to police bad brand behavior like these false strikethrough prices - even though they are a major violation of FTC policy.
eBay's corporate Business Ethics policy has a whole section on "avoiding conflicts of interest" and "acting with integrity", not to mention the section about advertising honestly and not making false or misleading claims.
Marketing and advertising honestly
Every claim in our advertisements and marketing materials must be accurate, objective and verifiable.This means that we must research and document our claims prior to publication. Laws governing comparative advertising, including pricing, vary from country to country, so it’s important to obtain guidance from Legal when making such claims to ensure that we comply with applicable laws.
Making false or misleading claims contradicts Our Beliefs. Legal can provide guidance if you are unsure whether something is false or misleading.
Their Code of Business Conduct and Ethics for Third Parties also makes it clear they expect companies with which they do business or have agreements to follow ethical guidelines as well.
Fair Business, Advertising, and Competition
Third Parties will comply with all applicable fair business, advertising, and competition laws, including fair trading and anti-trust laws.Cooperation with Regulators
Third Parties will cooperate with regulatory authorities, including, but not limited to, inquiries, audits, reviews, or investigations related to the business the Third Party is conducting with eBay.This Third Party Code of Business Conduct and Ethics assists eBay in complying with its regulatory obligations in various jurisdictions, such as the UK’s Modern Slavery Act, and eBay expects Third Parties to take steps to also comply and work towards ensuring that there are no such practices in their supply chains.
Perhaps newly hired Chief Risk & Compliance Officer, Ryan Jones, should look into the longstanding serious conflicts of interest and unethical behavior by both eBay and the brands that continue to flout the FTC's very clear guidance that shows misleading strikethrough pricing is considered a deceptive business practice.
Brand lawyer Rob Freund also has several great threads on Twitter about the subject, referencing a recent Udemy settlement involving advertising fake discounts.
Udemy has agreed to pay $4,000,000 to settle a case alleging it advertised fake discounts for its courses.
— Rob Freund (@RobertFreundLaw) April 28, 2023
Remember: using fake reference prices to run sales is illegal under the FTC Act and California's laws. 1/ pic.twitter.com/faqA2tu9An
And Amazon is facing a class action lawsuit and possible FTC action for allegedly using fake strikethrough pricing to present false Prime Exclusive discounts too.
Liz Morton ~ Founder
Unfortunately eBay has shown time and time again that consumers cannot rely on them to simply do the right thing.
The only thing that appears to get eBay's attention is regulatory enforcement, like in Australia where the company was forced to introduce a comparative pricing policy to curb these misleading strikethrough pricing claims.
Liz Morton ~ Founder
As long as eBay and these brands are allowed to get away with it, consumers will continue to be harmed by these deceptive discount promotions.
If you see fake discounts being presented on eBay or anywhere else, here's how you can report it to the FTC:
Do you trust that you are getting a fair deal when you shop on eBay? Let us know in the comments below!
