I got a bunch of calls in the last couple days about Stormy, why she rolled off auctions, did she leave the company, and who Meghan is. Stormy is a brilliant street-fighter whom I move around the company to dive into our biggest problems and opportunities, usually with a few analysts in tow. When we decided to do mass advertising she wrote our radio and TV ads, produced those commercials with Sabine, and buys our airtime. She also took over customer service and brought it to #4 in the country in about a year.

Stormy came into auctions in late September, and within a few weeks had pretty much diagnosed the problems (disparate treatment for small sellers, and the subscription plans that made listings so cheap that we got far too many listings starting at artifically high prices, which smothered everyone’s sell-through-rates and destroyed all of our economics). She suggested the plan of going back to a listing fees for everyone, and the other changes we made to level the playing field among sellers. She also realized cut our costs in auctions dramatically, so that the tab became an economically viable proposition for us.

As you must have noticed, things have turned around dramatically in the last few weeks. Listings have dropped almost as far as we wanted them to; we see that the sell through rates are many, many times higher than they have ever been on our site; page views/auction have soared, etc. Once it was clear that these changes had pushed things in the right direction, I moved Stormy on to other duties (developing a new source of revenue for us, while maintaining our customer service and branding departments). We handed the reins to Meghan.

Meghan is a terrific young woman whom you will be getting to know better (I have asked her to create a forum like mine: you will see her picture up tomorrow, I hope, and will probably never check in mine again). She shares my and Stormy’s belief that some basics had been forgotten on this auction tab, and that simplification is good. She has a small, tight team now that has things under control. Our customer service and content review is managed by Jason, a wonderful fellow we hired some time ago with solid experience at eBay, and of course, Joe P handles our relations with the largest sellers.

Incidentally, Meghan now reports directly to me, and I am really enjoying watching these changes take hold. i know that I made a few abrupt moves on the controls some weeks ago, because we wanted to start off the new year right. I am sorry about that, but we are very glad we did, because every auctions metric that we care about has turned around sharply. Stormy can be proud of the decisions she made, as Meghan can over the auction tab she now commands.

So please, never doubt that you are in good hands with Meghan. We have returned to first principles, adn they seem to be working.

Here is a question: it is our hope that by getting conversation rates up as they are now, sellers will gradually realize that they can list more items (I think the average seller now lists more than a dozen at a time). I expect they will experiement, increasing the numbers bit by bit, to see what our traffic supports. I also expect, or at least hope, that as word starts getting out into the eBay community, a few more sellers may come try things. And lastly, I get the impression that some eBay groups are sticky, that is, that some sellers will bring dedicated buyers when they come.

How realistic does this sound?

Respectfully,

Patrick

I write today most respectfully to request your attention to our new “Cars” tab on the our top navigation bar. A car is the second largest purchase people make. Yet the normal car buying experience fills people with dread, fraught as it is with high-pressure tactics. We designed our car tab to reduce that pressure by creating a channel for customers and dealers to find each other and begin discussions on a happy note.

Overstock does not own the inventory you see listed: all these cars (new, used, and certified) are being offered by dealers. Simply navigate to a car that interests you and then choose from three options: offer the dealer’s lot price, or make a counter-offer, or simply ask for more information. Your entries are automatically and immediately forwarded to the dealer, so the conversation can be started easily, without the commitment or pressure that comes from starting the conversation on their lot.

We have long considered extending the Overstock model to the auto industry. In fact, in the last few years folks in the industry approached me several times about doing this, and I, stupidly, delayed it. Now that we have launched it in Beta three weeks ago we see its power already: customers are using it to find good deals on cars. Just as we do with the products we ship you, we intend to uphold our end of our bargain to our customers by searching for the best and most reputable dealers in each state, tracking our customers’ satisfaction by dealer, promoting those dealers who really wow our customers (and when necessary, leaning a bit on those that don’t). You get to go car shopping with an 800-pound gorilla at your side.

We currently have 4,000 vehicles in seven states. This inventory is growing daily, as our “Ocars” team is working hard to bring more vehicles to the site quickly. In fact, I hope to have 100,000 cars by the end of Q1. We’ll see.

We plan on keeping the search experience clean, making the product descriptions as informative as possible, and creating a car buying experience devoid of pressure. Welcome to Overstock Cars.

Your humble servant,

Patrick M. Byrne