Online auctions are more than a way to liquidate, Sears finds
From their role as a liquidation tool focused solely on improving cost recovery, “Online auctions have grown up,” Scot Wingo, CEO of ChannelAdvisor Corp. told Internet Retailer’s conference and exhibition in Chicago this week. With strategic planning, retailers can use online auctions as a liquidation tool that also drives revenue and margin, acquires new customers and lifts both brand awareness and market share, according to Wingo.
ChannelAdvisor, which provides technology and services that connect retailers to eBay and other online marketplaces, joined David Southworth, direct marketing manger of hardlines at Sears Holding Corp., in a presentation on “What retailers need to know about selling on eBay.” Noting that eBay now has sales of about $40 billion globally and a marketplace of 147 million registered users, Wingo says eBay can be good for introducing products, he says, citing an eBay charity auction that also served as an online test of response to a new variety of Motorola phone. But because of the deal-hunting nature of the typical eBay user, it continues to excel at moving merchandise at the end-of-life cycle stage.
Channel Advisor client Sears has launched three different auction outlets on eBay, each geared to liquidating a particular type of excess merchandise. “We felt there was a huge opportunity to innovate on the back end for products that are less appealing,” says Southworth.
Southworth says Sears has identified a large and growing value-oriented market for quality returned merchandise. Sears’ brand power brings credibility to its use of the auction channel, he adds, and the multi-outlet auction strategy has helped maximize Sears` recovery rate on excess and returned goods.
Sears on eBay is devoted to new, surplus merchandise, while Sears Liquidation Center on eBay focuses on open box returns. Sears Appliance Outlets on eBay employ a cross-channel strategy in which a customer bid regionally and arrange to pick up the item or have it delivered from a regional brick and mortar Sears Appliance Outlet store. All three eBay auction outlets are accessible through an auction tab Sears.com’s home page.
Southworth says that the Sears Liquidation Center on eBay is running 300 to 1,000 auction listings per day and that the Appliance Center on eBay is driving traffic to the brick and mortar outlet locations. About 20% of the customers who come into an outlet store in pursuit of an eBay listing buy more or upgrade, he adds.
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