• Ratings overhaul marks biggest shift under CEO Devin Wenig
  • Online marketplace seeking to lure more buyers and sellers

EBay Inc. is overhauling its ratings system so that sellers aren’t penalized for late shipments beyond their control or for routine returns and exchanges, seeking to boost sales as an independent company.

While the online marketplace has long relied on a five-star rating system and commentaries that lets merchants and buyers grade each other on transactions, sellers have long complained that these also make them vulnerable to customer angst over minor issues that are unavoidable or easily resolved.

EBay’s seller rankings can make or break the merchants selling everything from sweaters to smartphones, because they influence how prominently products appear in search results and the likelihood that shoppers will conduct business with them. EBay is stepping up efforts to keep its sellers happy, following its split in July from the PayPal Holdings Inc. transactions business.

"Our relationship with our sellers needs to be improved," Jordan Sweetnam, EBay’s vice president of seller experience, said in an interview. "These are the biggest changes we’ve made in years."

Chief Executive Officer Devin Wenig is seeking to expand the number of buyers and sellers on EBay, which debuted 20 years ago and now has 25 million merchants. The e-commerce pioneer is facing stiff competition as merchants list more goods via Amazon.com Inc. and Etsy Inc.

"The announcements we’re making today are a down payment on how we’re evolving the partnership with our sellers," Wenig said. "We’re making it simpler and easier to sell on EBay, and helping them to be more profitable with new tools and insights."

EBay’s same-store sales grew by 3.4 percent in August, their slowest pace since February 2011 and less than total e-commerce growth of 15 percent, according to ChannelAdvisor. EBay has attributed its sluggish growth to a data breach last year that forced users to change their passwords and changes to Google Inc.’s search engine that resulted in less traffic going to EBay.

The new rating system is more simple and objective, according to Sweetnam. Sellers won’t be penalized for late deliveries as long as they get orders to couriers on time, while returns or exchanges won’t affect ratings if they’re resolved and the customer is satisfied with the process.

"I think this is going to bring a lot of business back to EBay," said Jordan Insley, owner of Quick Ship Electronics in Seattle, who has been selling goods on EBay for about 13 years. "They are creating a level playing field. Take care of your customers, and you’ll be fine."

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