I found this interesting post on a blog by Peter Quintas. He was discussing how his wife was an avid buyer and seller on eBay and how she could benefit from having a blog.
His points are below. They are good ones and go beyond improving your reputation among buyers at eBay.
 
Why blog?

To compliment a sellers status, the seller should have a blog.   And heres why:
  1. Be found
    Blogs are very well indexed by search engines.   So a buyer that goes out onto the web (before going to eBay perhaps) and Googles "Ugg Boots" or "Mukluk Boots" are likely to find your blog on fashion (and your entries on how these boots are so damn hot and why, whos wearing them, and where to get them -- in your auctions), will find you faster (or at least it is another avenue to find you).
  2. Become an expert
    You should have a blog especially if you sell within a certain niche or focus.   You would be blogging about your niche, your area of expertise in that niche (for example, my wife focuses on trendy clothing and accessories).   In each of her auctions, you can link to your blog... "Click here for more fashion trends".   Buyers browsing can click to your blog, recognize you as an expert, and feel more comfortable buying.   It may even lead to a cross sell or return buyers.
  3. Create loyal, repeat buyers
    Buyers who find good product will return to the same seller.   Buyers who are in search for information about a class of products will follow the information on the blog, a channel into future auctions and sales.   Give a buyer good information and they will return to read it.   The same thing happens in the example of trendy clothing... people look to Us Magazine weekly to see who is wearing what and how.
  4. Richer feedback channel
    The feedback mechanism on eBay is limited.   On a blog, with commenting and trackbacks, you can have an unlimited, rich thread of feedback on your auctions, and other general discussion on items you sell that create a rich community of content and information that, in a full circle, would lead to being establlished of more of an an expert and being found more... leading to more sales.
 
Read the full post here.
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