Sunday, April 6, 2014
Ebay: not just an auction company
eBay, the first company that we think of when we think "online auctions", now makes less than a third of their revenue from actual fees from auctions. Considering they are the proud owners of Half.com, Paypal, and StubHub, this kind of makes sense. But another major contributor to that revenue-to-auction ratio is the very popular Buy It Now feature, in which customers bypass the whole auction process and can get a good price on an item and have it shipped post-haste, instead of fretting about outbidding unknown people in an auction. Because of the nearly non-existent menu costs of e-commerce, as well as the delayed gratification of online auctions and the prevalence of the controversial practice of bid sniping, eBay is starting to sell more Buy It Now items than it auctions. Experienced sellers know how much their products are going for at auction now, so why wait for a 7 day auction to finish if it will just end up within 5 or 10% of a Buy It Now price? There will always be auctions for collectibles, antiques, and unique items, but for the mundane items from seasoned consumer-sellers, Buy It Now just makes more sense.
Reference: http://www.wired.com/2011/05/ff_endofauction
- Kyle Whittlesey
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6 comments:
I have a experience that seller use other account to increase price for products. After I tried to buy a lot of times, I dont believe them anymore. They start very low price to attract people to bid. However, it is not a real price that I will get.
Buying online, especially via Ebay, is a growing trend of Americans in the 21st century. It is more convenient to search for the product and compare prices online verses going from store to store. I personally enjoy browsing through the list of products on Ebay and comparing the quality and price of items before making a purchase. I do agree with the previous comment that starting at a low price does not guarantee the actual selling price.
Sometimes eBay is the best option for some items. Although you gotta wait a little longer than you usually would to get it. At the end you do get what you pay for though.
I was very surprised to find that eBay does not make most of their revenue from the auction side of their company. The buy it now feature to me seems like you are just shopping online at any other website and kind of ruins the original purpose of eBay which I always saw as an ability to outbid people on an product for cheaper than the original price. I also never knew that eBay owned all these companies. Its kind of bizarre that a company known for a specific service does not even make the bulk of its revenue from that service.
I don't shop on Ebay often, Amazon seems a little more convenient for me, but when I do shop on Ebay I tend to look for the "buy it now" option. I would rather just buy the item then wait for the auction to finish.
Yating Hsu, what you are describing is called shill bidding and it is an illegal practice. If you suspect this is happening, you should report it to the website hosting the auction.
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