Why the line between auctions and other online marketplaces is blurring
One of the biggest changes in the online auction space in the past few years is that increasingly, the talk is of online marketplaces rather than specifically of auctions, Scot Wingo, CEO of auction software and services provider Channel Advisor, tells Internet Retailer. “We don’t use the word ‘auction’ so much anymore, because the line between auctions and other marketplaces is blurring,” says Wingo.
“Ebay says 23% of its business is in the fixed price format. Amazon, which doesn’t do the auction price format per se, is becoming a place where third-party sellers come to meet Amazon’s buyers,” he says. “Some argue that Amazon doesn’t compete with eBay because it doesn’t have auction pricing, but you could argue it does, because they are both marketplaces.”
The biggest divider between the eBay and Amazon marketplaces is not so much different pricing formats as different audiences, says Wingo, who estimates an overlap of only 10% between those who regularly shop eBay and those who regularly shop Amazon. While eBay does well with liquidation products, for example, it doesn’t do as well with retail products. The reverse is true of Amazon, because of the different audience, he says.
“The Ebay buyer is looking for 20% to 80% off retail. That’s why they like auctions; they draw them in,” he adds. “The Amazon audience is the flip side. They don’t want the 2-year-old camera; they want the camera that just came out. They are most interested in new products, the latest and greatest, convenience and then price.”
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