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DWM, my posts are not meant to be discouraging, but to suggest a more realistic direction. Overstock.com launched an auction service during a major defection of PowerSellers from eBay, spent literally tens of millions of dollars promoting it online, in print and on television, and where is that now? Amazon.com didn't promote their auctions as hard as Overstock did, but come on -- it's Amazon. Largest retailer online since 'retailer online' was a word. No competition. And while everyone is still trying to figure out a way to knock eBay off of its perch, eBay itself is looking for ways to decrease its exposure to and dependcy on auction revenue. That's why I say that toe-to-toe with eBay is a fight fit for Don Quixote, not a way to seriously trying to make a living.

eBay restricts a number of products, practices, entire countries and more from using their site. It is in these 'marginalised markets' where the real money is to be made with an online auction platform. I've owned two small niche auction sites that picked up such crumbs from eBay's table; both made money and both were sold for a nice sum. I'm in the process of launching a third one, and anticipate it doing well due to being in a timely market. I can't imagine sinking a cent into trying to replace eBay, because it would be money wasted when so many niche and local sites are doing so well picking up the slack in eBay's coverage.

Not to ramble, but to try to better explain my recommended approach, I wanted to start a company similar to Zipcar.com at one point. I researched and researched and made all kinds of plans to raise the millions I needed to establish such a network, and years went by, and now -- unlike back in 2000 when there was no competition -- not only are there hundreds of such companies in the US alone, but Zipcar is the market dominator and has been slowly but steadily buying up small local competitors as part of its expansion plan. So, if I were to decide to jump back on that idea, what would be the better plan -- try to start from scratch to knock a billion-dollar-a-year market dominator out of its spot, or fund a few small local operations with an eye to get bought out in a few years?

Small is beautiful.

Frank

Hi Frank,

Thats all good to know and I greatly appreciate all that advice!

Like I said in previous posts im not about to take any action yet and still in the tought process.

So what your saying when it comes down to it is its better to makes smaller sites that niche to very specific buyers and just use that strategy to take small pieces away from bigger companies and see if you can profit off of getting bought?

I know its a lose lose situation to try and completely compete with eBay but who is to say that these companies are not to be stopped?

I think when it comes down to it, it takes a very specific and fine line of strategy to get things moving. As for Overstock.com, well im not sure if you were saying that the auction format didn't work because I see it as working pretty well indeed I mean their site traffic is huge and they seem to make money if they spend millions on adverts. So Im assuming your saying they tried the strategy to win over sellers and buyers from eBay but indeed there is still something in a big black hole that even big companies I trying to find that missing piece to win customers over on ebay and that piece is what Im trying to solve! The other big problem with taking eBay on is they get not only so much adverts but the press like cnbc continue to bring their Name up and its just too much of a Household name these days. Heck, I had my dad tell me the other day he was search ebay for the first time to find a repair kit for his camera and he never heard of ebay before but was told about it from a guy at work! LOL thats the other problem.

5 days later
dwm

So what your saying when it comes down to it is its better to makes smaller sites that niche to very specific buyers and just use that strategy to take small pieces away from bigger companies and see if you can profit off of getting bought?

Buy out is one way to do it, to be sure. Either way, as eBay continues to circle the wagons around its revenue and places further restrictions on sellers and buyers, the opportunities abound.

I know its a lose lose situation to try and completely compete with eBay but who is to say that these companies are not to be stopped?

I will: you will not stop eBay, and neither will anyone else.

Don't forget:

--> eBay's own financial statements show that the share of its income that auctions represents has been in steady decline for some time now (while their overall income has pretty much just gone up and up and up)

-->Huge 'next in market' competitors like Overstock and Amazon have spent millions trying to knock a dent in eBay's auction business, to essentially zero effect. (and don't even get started on Bidz, uBid et al.) Meanwhile, eBay has started edging in on those competitors by favouring fixed-price sales, large sellers like Buy.com, streamlining payments and invoicing, etc. etc. etc.

It is simply laughable to think that someone will come along and knock it out of place. In fact the only saving grace for such a notion, if one could even be said to exist, is that eBay will continue to move farther and farther away from the auction model that produced the bulk of its userbase but virtually none of its bottom line profits. So, once eBay is done with the auction model and more or less abandoned it to posterity, then sure, it is conceivable that someone else will snap it up. But not any sooner -- the little crumbs the giant lets drop from the table, eg. firearm sales, alternative currencies, buyer premium auctions, direct trades etc. -- are where the auction platform money is to be made.

Frank

Well Frank I appreciate your opinions however you stated that amazon didn't hurt eBays business, well? you better read the news a little more my friend because right now Amazon is really hurting eBays business in fact if you just did a little reading, eBay is only making these fee changes because their core business is taking a huge beating so they need to win back sellers by doing this and trust me once they do that, their fee structure will go right back to where it was...lol not to be rude but by how you speak of ebay you should try to apply for a job with them...you might even be a good PR for them :)

hey dwm take it easy on the guy, even if you don't agree with him...he is only stating his opinion. we can agree to disagree...lol..peace!

Yeah your right Bizhope! Frank I apologize...didn't mean to get rough on ya just don't really like when people say something is impossible but like bizhope said its your opinion and I can agree to disagree.Again hope I didn't upset ya by those comments. :)

6 days later

No big deal dude. I have years of actual experience working with the options on one hand, you have what you think sounds right on the other. You're not likely to offend me, and I hope not to offend you. Facts are facts, and the facts in the trenches are 1) eBay runs online auctions and 2) will continue to do so until they get tired of it and 3) the money to be made in online auctions off of eBay is in the scraps they discard. Good luck with your project.

Frank

Ebay is not perfect but it is my wholesale supplier where i turn right back around break up the items and sell for a profit on ebay ,,ebay fees are high beause they market better than any other site and everyday new people discover ebay .the fees are not that high they get about 15% of my gross and do all the advertising for me ..when i had a small store the store expenses were about 25%-35% ..as i had to pay rent -electric and insurance -and do my own advertising ..also had to depend on the local economy ... with ebay my sotre is open 24/7 to people all over the world .