It seems to be a law of nature — there can be only one quality online auction site in a given market. Yes, Amazon and Yahoo continue to hold on to their auction sites in the U.S. Presumably these operations are profitable and by keeping their auctions going, Amazon and Yahoo avoid the embarassment of being declared the loser. But really, guys, this war is over.
Just one example: Auctions of U.S. coins. Amazon has 412 auctions listed. Yahoo has 959. EBay has 90,500. ‘Nuff said.
That is not to say there can’t be other auction sites in the U.S. or in other places where a dominant auction player has emerged. To work, these sites must slice the market non-geographically, or come up with a truly innovative auction format. Vertical sites focused on particular kinds of sellers (or maybe even buyers) can work, even if eBay dominates the mainstream market.
The Philadelphia Inquirer has a story today about how state and local governments are using online auctions to sell stolen goods seized from crooks and surplus items. There’s a vast market for these auctions, and eBay appears to be doing next to nothing to develop it. That leaves the field wide open for Bid4Assets, which specializes in government auctions. The Inquirer article (which for some reason mentions Assets.com, probably because some copy editor thought Bid4Assets looked wrong) notes that government users seem to think it’s a lot of work to set up an online auction. Bid4Assets apparently is listening, and recently changed its listing process to make it easier.
Bid4Assets competes against another pretty good site, PropertyRoom.com. PropertyRoom.com is even more specialized, focusing on police auctions. PropertyRoom.com is a real innovator. For instance, it automatically extends auctions for 10 minutes if there is any last-minute bidding, which seems like it would be guaranteed to drive prices up and make sellers happy. But PropertyRoom.com recently announced it is opening the site to ordinary merchants to improve the selection of merchandise for sale. Apparently, crooks aren’t stealing enough Treo 650s and power drills.
This change could be a good thing, if it doesn’t distract the company from its core police auction market and actually broadens the merchandise selection. But you have to wonder whether they can keep everyone happy, and with only about 2,500 auctions running right now, there have to be some police stations that are not yet online. Branching out seems like a mistake to me, but time will tell.
Other twists on the eBay theme do not seem likely to be successful. ClassifiedBuyers.com has trumpeted how it “Outsmarts Online Fraudsters.” All auctions on the site go through escrow, which (if the escrow agent is honest and competent) should completely eliminate fraud. But there are some big downsides:
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Sellers don’t like waiting for their money, and don’t like the suggestion that they are crooks who must be watched.
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It’s kind of a hassle for buyers, too.
- EBay feedback is a tremendously effective (though imperfect) fraud killer.
- Anyone can use Escrow.com with eBay (but almost no one does).
- Has everyone forgotten the escrow scams of 2002?
- Most importantly, ClassifiedBuyers.com is a ghost town. One of its top level categories is “bears,” and their are a grand total of six teddy bears for sale, plus someone is selling a sign with a teddy bear on it. Ebay has — count ‘em — 3,130 teddy bears for sale.
EBay has nothing to worry about from ClassifiedBuyers.com.
Suggested Reading:
eBay For DummiesThe bestsellng guide to successfully buying and selling on eBay, fully revised and updated
eBay is the world's #1 shopping and selling si... Read More >
E-Business and E-Commerce Management: Strategy, Implementation and Practice (4th Edition)
