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EBay Inc.'s incoming chief executive officer John Donahoe has wasted no time shaking up the online auction company, launching a series of fee changes and new selling standards designed to kick-start lacklustre growth and win back disgruntled customers.

Mr. Donahoe, who is taking over the top spot at eBay after long-time CEO Meg Whitman announced her departure last week, acknowledged yesterday that the Web-based selling system needed a revamp after 12 years in existence.

"EBay is at a crossroads. To maintain our leadership position in e-commerce, we can no longer afford to make incremental changes to meet our customers' needs," he told a company conference in Washington. "We need to redo our playbook and we need to redo it fast. We need to take bold actions to meet the expectations of buyers and sellers around the world."

While eBay is still an Internet powerhouse handling transactions worth about $60-billion (U.S.) last year, the demands of more sophisticated buyers require a rethinking, he said.

One of the biggest changes he's making is a cut in the price eBay charges to list items on the site, while it will boost fees charged when a product is sold. The company is also allowing sellers to include photographs of their products for free.

For example, under the new regime a $25 item that used to cost $1.20 to list will now generate an "insertion fee" of $1. When the $25 product is sold, the fee will be 8.75 per cent of the closing price, up from 5.25 per cent.

Mr. Donahoe said the idea is to boost the volume of its business, not eBay's profit. Over all, the company will collect slightly less in fees under the new structure than the old, he said.

And to discourage sellers who charge excessive shipping fees, or who don't describe their products accurately, the company is implementing a system where ratings — submitted by buyers — will determine where a product shows up on computer screens when buyers do searches.

Essentially, sellers who have bad ratings will get less exposure than those who get top ratings.

Buyers have increasingly shown "trust concerns" over shipping practices, Mr. Donahoe told product sellers at a question and answer session in Washington. Many buyers believe shipping fees are being inflated to offset low selling prices, he said.

While eBay is launching the new features on different dates around the world, eBay Canada will put them in place on Feb. 20, the same day as in the United States. With the Canadian dollar roughly at par with the U.S. dollar, fees are now identical in the two countries.

"What we're trying to do here is to make sure that we continue to be the number one place to conduct e-commerce," said Andrew Sloss, e-Bay's country manager for Canada.

While Canadian shopping patterns are very similar to those in the U.S., Canadians seem to be willing to look further afield to get a product than their counterparts south of the border, he said. "Canadians think of it as a North American marketplace."

While eBay is still a money-spinner — the parent company generated $2.1-billion in profit in 2007 — it has seen growth slow sharply in the past year. Only 2 per cent more active users were on the site in the fourth quarter of 2007 than in the same period of 2006. It has also been facing steep competition from other on-line shopping sites such as Amazon.com.

Laura Martin, a New York analyst at Soleil Securities Group Inc., said the changes at eBay are essentially an effort to boost demand for its services. "These changes are focused on making the buyer experience better ... and I believe if buyers come, sellers will follow."

The moves didn't succeed in boosting eBay's beleaguered stock price, which fell 2.8 per cent on the Nasdaq stock exchange. The stock was above $40 late last fall, and is now close to its lowest point in 15 months.