Judgement day for ebay????

by Ryan L 17 replies
Here is a recent article I "stumbled upon" (haha) and thought I would share it...Obviously, there are many startup companies that have tried to compete with eBay in the past--but this one sounds like a worthy contender!





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New Online Auction Site Tries to Take Advantage of eBay Vulnerability


Trying to take advantage of unrest among the eBay (EBAY: 26.36, +0.90, +3.53%) community, start-up Wigix is betting its auction Web site can give eBay some much needed competition.

“There’s enough unhappiness with the current model that even if we were to take a pretty small percentage away we would be doing pretty well,” said Bob Lee, co-founder and chief technology officer at Wigix. “EBay is the gazillion-pound gorilla and, even as they acknowledge the model needs a bit of tweaking, for them to make a change is pretty difficult.”

Oakland, Calif.-based Wigix, which has venture capital backing from Draper Fisher Jurvetson, launched its online-auction site this past spring. Taking a page from stock market trading, the former Charles Schwab (SCHW: 22.82, +0.96, +4.39%) executives who developed Charles Schwab's initial web trading platform created a model that lets people buy and sell items based on a bid-and-ask system.

For example, visitors to Wigix who want to buy an iPhone will see a list of all the sellers and can name the price they want to pay. An interested seller would then accept the price, with the parties arranging shipping. People searching for an iPhone would only see the iPhone and all the pertinent information at one page instead of how eBay (EBAY: 26.36, +0.90, +3.53%) does it, with multiple listings showing up from a search.

“Chuck Schwab made the comment that if you build a great trading platform you could even sell baskets on it, and we took that to heart,” said Lee.

Wigix also incorporates what it calls "passive selling," which means users are able to create a portfolio of their stuff and people can make offers for that stuff. “Just how you want to know what your stocks are worth, you can know what your stuff is worth,” said Lee.

Wigix comes at a difficult time for eBay, which has faced unhappiness among its community over recently implemented seller polices. The company’s move to ink a deal with Buy.com in which Buy.com will list thousands of items on eBay for set prices upset eBay sellers because of the competitive threat Buy.com poses. Many people make their living selling on eBay. Officials at eBay weren't immediately available for comment.

Still while some eBay users may not be satisfied, the market as a whole is moving toward fixed prices, which may not bode well for online auction start-ups like Wigix. Scott Devitt, an analyst at Stifel Nicolaus, said eBay’s biggest problem has been in fixed prices, where Amazon.com (AMZN: 80.51, +3.56, +4.62%), Google (GOOG: 495.01, +15.89, +3.31%) and traditional retailers have been hurting the company. He said that successful international eBay competitors have incorporated fixed sales into their models.

Nevertheless Wigix’s Lee thinks the company will lure sellers and buyers. “A lot of our users are people who are very frustrated with eBay right now,” said Lee, noting that Wigix’s fee structure is a selling point. For items that sell for less than $25, Wigix doesn’t charge a fee. The buyer and seller is charged $1.50 for items that sell for between $25 and $100, with an additional 2% for sellers for anything between $100 and $1,000. Anything over $1,000 has an additional 1% fee for sellers. Visitors can pay via PayPal and Google Checkout. The company plans to add more options in the future.

Given Wigix is an Internet start-up operating in the Web 3.0 era, the company not surprisingly also includes social networking in its service. Aiming to create the Internet’s largest catalog of items, Wigix pays people to create a page within Wigix on a specific item and become the expert in that category.

For example, you can create a Web page for a specific BMW and, if someone eventually sells that BMW model at a later date, you would share in the revenue generated from the sale. Category experts are well vetted through Wigix and have to apply just like any other job. Their expertise is rated and an expert can change from year to year. So far Wigix has a million items in its catalog and is tapping the community because of its goal to have almost an infinite amount of items.

“We don’t have the wherewithal to build it ourselves,” said Lee. “We’re leveraging the community to help.”
#main internet marketing discussion forum #auction #buy.com #ebay #wigiz
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  • Profile picture of the author Ryan L
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    • Profile picture of the author SpicyRobby
      Hi Ryan,

      Yes, there are many online auctions trying to rival eBay - and it is a good indicator.

      Yes, there is a great amount of frustrated eBay sellers - and they'd be happy to leave eBay for good and a great share of them are focusing their online activity on their Internet shops/own websites.

      However, there is another rival in the marketplace already --> Amazon.

      And taking into account eBay's and Amazon's huge market share and liquidity it would be really hard to imagine another major player appear in the foreseeable future...Many would welcome it, but unfortunately that's the way the whole world's gone. Companies tend to merge into corporations and eventually there's only a few or one major player - like Google, Microsoft etc.

      We've seen lately as well how eBay has bought a bunch of smaller promising companies - and no one can ignore the huge power behind eBay's multi-million funds.

      I guess the reality is the following - many shoppers would love to leave eBay, but they just understand there is no actual alternative to it. Even Amazon is not exactly the place they're looking for.

      Rgds,

      Robert
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      • Profile picture of the author Ryan L
        Robert, I really enjoyed your response...I agree with what you were saying!

        It seems like a third party auction site would be much more welcomed by the sellers - not particullary the buyers.

        It will be an interesting attempt! Im just impressed that they've gotten actual press coverage, hehe...A step in the right direction =D
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        • Profile picture of the author Richard Tunnah
          I'm sure I saw on the news that ebay may lose a massive court case soon for not acting against fake goods sold on ebay until the recent crackdown. They seem to have gone the other way now and that with increasing fees makes life harder although it's difficult to replicate in such a quick fashion the exposure you get on ebay.

          Rich
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          • Profile picture of the author ExRat
            Hi,

            They're also expelling some of their long term affiliates. They haven't done it to me, but there are a few in the last few days in a community I mingle in. The way they do it isn't particularly nice either -

            They lock you out of your account. You email them to get a new password. After a few days they email back saying, 'we expired you for breaching our terms, the reasons are given in the email we sent you' - (which, strangely, no one ever gets).

            Then they hang onto that months money and that's it. Game over.
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            Roger Davis

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            • Profile picture of the author pwebbiz
              Ryan,

              I'd love to see how Wigix expands! Sounds like a really sweet mix between eBay and Craigslist.

              Boy, I used to be such a huge eBay fan but I left after that huge fee increase. That and the redone Trading Assistant program was enough to send me packing. I also HATE that you can't see the bid history on a product any more - or the top bidder.

              eBay let their power get to their head and I hope it comes back to bite them!

              Did I mention how furious I am about them banning digital products?

              Uggh...

              @Roger,

              All too many companies do this and it's disgusting to see eBay fall to the level of the scammers that pull the 'you broke some rule that we won't disclose...so we're going to keep your money'

              Thank you both for your excellent contributions!

              Michael
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              • Profile picture of the author Kay King
                Robert has a good point. Amazon has given ebay a big run for its money and to me Amazon is winning.

                In the past year, I almost always start looking for a product on ebay and end up buying it from Amazon. The price is often lower, shipping is often free and I have yet to receive a cloned product from them (as happens too often on ebay).

                True, it's not an auction but in fact many items sell more cheaply on Amazon than on ebay these days. By moving away more and more from the small seller to big biz, ebay may lose its competitive edge on pricing for many items. One example from this year was a dog house purchased for a neighbor's pet. Exactly same product was $75+23 shipping on ebay, $68 on Amazon with free shipping.

                I've wondered if some of the changes at ebay are a response to the competition from Amazon.

                kay
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                • Profile picture of the author sparrow
                  More power to them, the more competition the better the market is.

                  Ebay recently has pulled some non friendly moves for the sellers.

                  In addition I think their market has gotten out of control, I recently suffered issues with them and my account what a mess.

                  Change is good.

                  Ed
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                • Profile picture of the author Kim Standerline
                  Originally Posted by Kay King View Post


                  In the past year, I almost always start looking for a product on ebay and end up buying it from Amazon. The price is often lower, shipping is often free and I have yet to receive a cloned product from them (as happens too often on ebay).

                  kay
                  Hmm I hadn't actually realised I'd started doing this myself until you pointed it out Kay.

                  At one time ebay was always my first port of call, now its amazon every time.

                  I used to sell prolifically on ebay up until about 3 years ago (and did very well at it).

                  I decided to revive my ebay career a few months ago, I soon gave it up as a bad job, I couldn't believe how much the fees were, and to be honest it wasn't worth the time or effort

                  Kymi
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                • Profile picture of the author neddag
                  Originally Posted by Kay King View Post

                  Amazon has given ebay a big run for its money and to me Amazon is winning.
                  Actually, not just to you. I'm pretty sure Amazon had a larger market share than eBay did during the 2007 holiday shopping season. First time that's ever happened.

                  I'm currently a silver Powerseller and slowly moving down the Powerseller ladder while planning the transition to Amazon for this Christmas season.

                  Ned
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                  Something is happening here but you don't know what it is.....

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                • Profile picture of the author WittySales
                  Originally Posted by Kay King View Post

                  I've wondered if some of the changes at ebay are a response to the competition from Amazon.
                  kay
                  I think so...
                  I thought I went to Amazon.com
                  It took me a full three minutes to realize I accidentally
                  clicked the ebay button on my google toolbar.

                  Can't put my finger on it though but there is something
                  very Amazon looking about ebay right now.
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    • Profile picture of the author Steve Taylor
      I wish some company would blast that two headed monster out of their cave...
      good luck to them though...

      -Steve
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      Ask...Because you never stop learning.

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