ONLINE AUCTIONS

 

Q1: eBay is one of the only major Internet “pure plays” to consistently make a profit from its inception. What is eBay’s business model? Why has it been so successful?

eBay’s business model is a Brokerage model. eBay  is an online auctioneer acts as a broker, bringing buyers and sellers together and facilitates the transaction. eBay,  generates revenue through listing and selling fees and through advertising. eBay conduct advertisement on different media and become an interest to a consumers. It also offers goods which is often cheaper than in retail which is attractive to customers. In addition eBay is constantly researching ways for improvement and customer satisfaction. They always look and use customer feedback which help them to make strong consumer loyalty that is why eBay is so successful and popular on online  auction.

Q2: Other major web sites, like Amazon.com and Yahoo!, have entered the auction marketplace with far less success than eBay. How has eBay been able to maintain its dominant position?

eBay has been able to maintain its dominant position on online auction. The Amazon sells products by itself but eBay does not sell goods by itself. The seller registers and sells through eBay. Everyone can sell and buy on the eBay, it is more freedom.  It delivers good service at lower price, it offers free to bid and has its own safe payment method which provides security to its customers.

Q3: What method does eBay use to reduce the potential for fraud among traders on its site? What kinds of fraud, if any, are eBay users most susceptible?

eBay offers  safety procedures such as, identity safety, computer safety and how to avoid fraud through its security center . Security center has a reporting facilities where users can report fraud. eBay allows all its members to use PayPal as a method of payment. PayPal helps to protect financial information of customers. eBay also use to reduce the potential fraud through its use of feedback. This allows eBay to know about people trying to scam the system.

Types of fraud that eBay users are susceptible are:

· Identity theft

· Sellers fraud

· Fraudulent emails

Q4: eBay makes every effort to conceptualize its users as a community (as opposed to, say "customers" or "clients"). What is the purpose of this conceptual twist and does eBay gain something by doing it?

eBay makes every effort to conceptualize its users as a community than as clients or customers to help  users feel more involved in its services . It allows customers to feel part of a community and it is helpful for them to feel comfortable in the auction. Being a community member also help users feel more secure and gives a sense of trust in using eBay services.. eBay’s success is based on its community members success. 

Q5: eBay has long been a marketplace for used goods and collectibles. Today, it is increasingly a place where major businesses come to auction their wares. Why would a brand name vendor set-up shop on eBay?

A brand name may choose to set up shop on eBay because of the high number of users in eBay. This is an opportunity for the brand name to create awareness and interest of customers. Potential buyers may also be looking for discounted brand name products rather than paying full price in physical stores. Online vendors also can reach to customers who are geographically far.

Q6. I have a few businesses, and I have used eBay for about 12 years on and off. Currently I have about 600 books listed on eBay (seller name ozrural). I stopped selling on eBay for a few years but they changed the rules this July and it is viable again (for me). What do you think changed?

In july 2010 eBay changed its fixed price listing in the books and music categories.The new basic store fees for books and music are designed to help media sellers optimize their profitability by lowering the cost of listing on eBay.

Source:http://pages2.ebay.com.au/News/InsideSelling/New_Fees_for_Books_and_Music_Listings

Retrieved May11,2013