Aug
15
I thought it would be important to put myself in the buyer’s shoes for a complete review of eCrater.com. After all, if the site doesn’t make the buying process as friction-free as possible, there’s not much of a point selling there. Buyers who experience a confusing or difficult time are likely to abandon their shopping carts and move on to the next Internet merchant.
Initially, I went straight to the eCrater home page to start my shopping experience. I found myself a little nervous at the potential prospect of dealing with fraudsters posing as merchants. The feedback system isn’t very mature yet, and many of the merchants whose listings I visited were unrated.
Additionally, there is no verification required to register as a seller. While the seller in me sees this as a benefit, I’m uncomfortable with the additional risk this exposes me to as a buyer.
This was reminiscent of my experiences in the early days of eBay & Yahoo! auctions. I actually sold for a year before I ever worked up the courage to buy from someone I didn’t know in these venues. (I was always amazed when someone sent me a money order, someone they didn’t know, and trusted me to send them the goods).
Hesitant, I decided to take a break and hit Google to see what others were saying about eCrater. That’s when I came across a Blog of an individual who sold comic books on eCrater. After spending a little time on this seller’s site, I felt extremely comfortable that I was dealing with a real person (who, BTW, graduated from the same University as me) that wasn’t trying commit fraud.
After I followed the links to his eCrater listings, I realized that this is the way eCrater is supposed to work. eCrater doesn’t send traffic to seller’s listings in the same way eBay does (or used to). Instead, it is incumbent upon the merchant to send traffic to his or her listings after establishing some level of trust and credibility with the buyer. I’ve been preaching this for sometime on this blog, yet I still surprised myself a little with how effective this technique can be.
At any rate, I soon found myself at the home page of Walkin’ Willie’s eCrater Comic Shop: http://walkinwilliescomix.ecrater.com/. I was immediately impressed with the clean layout and the customization. The fact that this store is hosted by eCrater is not obvious to the visitor. The seller has uploaded his own logo and the only reference to eCrater is in the URL and a subdued “Powered by eCrater” link at the bottom.
Being the frugal shopper that I am, I immediately clicked through to the $.50 Specials category and found a couple of listings for Star Wars comics that my son would be interested in. The listings were simple yet, for the most part, contained all of the information I needed to decide to make the purchase. The only thing I was confused about was whether the seller would combine shipping or not.
Unlike eBay, eCrater offers a shopping cart, so I was able to consolidate all of my purchases from the same seller into one transaction. I decided to splurge and buy all three Star Wars comics the merchant had listed.
The shopping cart still did not dispel my confusion about combined shipping, but I decided to press on knowing that I would be able to back out of the transaction before making the payment if the seller required me to pay $3.50 per comic for shipping and handling.
The seller offered PayPal and Google Checkout as payment methods. Since I don’t have any experience with Google Checkout and because eCrater places a lot of emphasis on that form of payment, I decided to give it a try.
After clicking on the Google Checkout button, I was presented with a summary of my purchases and the option to either create a Google Account or sign-in to my existing account. I already had a Gmail account, so I only needed to add my credit card information in order to use Google Checkout. The process was fairly quick.
Completing my purchase with Google Checkout went smoothly. I was pleased to learn that the seller had set up his store to automatically combine shipping. I was only charged $3.50 for mailing all three comics.
I was also impressed with Google Checkout’s option to hide my email address from the seller. Because he had taken the time and effort to create a blog and website that built my trust, I felt comfortable providing that information to this particular merchant. However, when I first started this eCrater buying experiment, there were sellers from whom I was considering buying a $1.00 eBook via PayPal but hesitated because I was certain to wind up on more SPAM lists.
Soon after checking out, eCrater dropped me a note with a link to the feedback form in order to evaluate the seller. They will automatically send me a reminder in three weeks if I haven’t yet left feedback on the transaction. The seller does not have the opportunity to leave feedback on the buyer.
I was a little dismayed to see the items still listed and available for sale on eCrater right after I made my purchase. I guess the seller needs to acknowledge the sale or Google Checkout needs to send some sort of electronic confirmation before the listings are no longer available. If this transaction were for an in-demand item on a popular store, this phenomenon presents the very real possibility of multiple purchases of the same single item. eCrater needs to consider resolving this potential issue before it becomes a problem.
Google checkout sent me an email when the seller shipped the comics with a tracking number and the comics arrived safely soon afterwards. Leaving feedback was quick and didn’t involve detailed seller ratings.
Overall, I was quite satisfied with my eCrater buying experience. The integrated shopping cart encouraged me to buy several items at once. Had I bought the same items on eBay, this would have required three separate transactions and probably an email to the seller to coordinate combined shipping. The integration of Google Checkout was seamless and made for an easy purchase. While eBay struggles to “improve the buying the buying experience,” it seems that eCrater has it figured out.
eCrater’s mantra is “Cater to your sellers and buyers will come.” Fortunately the site doesn’t neglect the buyers either. I recommend that every seller first try a site out as a buyer when they are considering an eBay alternative. eCrater gets passing marks in my grade book.
Next post in this series: Registering as a seller on eCrater.
Aug
6
When David and I began AuctionBytes in 1999, the most common question people would ask us was, “How do I start selling on eBay?” Today, the most frequent question we receive is “How do I diversify?”
-Ina Steiner, AuctionBytes.com
As eBay becomes less and less of a marketplace in which small sellers can thrive, many merchants are left wondering what alternatives are out there. This article is the first of many that will examine eCrater.com for merchants looking for a different venue to sell their goods. This post provides an overview of the site while my future posts will discuss my experiences buying, setting up an account, setting up a store, creating a listing and selling.
eCrater was started in the Spring of 2004 by Ditimar Slavov as a marketplace of fixed priced products and hosting site for individual merchant stores. The site is free for buyers and sellers and, unlike most other free auction/market sites, does not feature advertising as a revenue model. eCrater depends on commissions from Google Checkout and fees paid by sellers for featured placement for monetization.
Emphasis on Sellers
I like the emphasis and attention eCrater places on the seller. According to their “About Us” page, the site “believes that a good foundation for a growing marketplace is a community of happy sellers.” This is a good sign for sellers disaffected by eBay corporate policy. Another positive indication is this quote found on the same page:
Cater to your sellers and buyers will come.
Friction Free Buying
There’s no registration required to purchase. This is a plus — keeping the buying process as friction-free as possible is important to a successful transaction. Prospective buyers simply add items to their shopping cart and checkout like virtually every other eCommerce site on the internet. While the site encourages Google Checkout, sellers can offer a myriad of other payment options, including PayPal.
Clean Website Design
I’m impressed with eCrater’s simple, clean website — it’s very reminiscent of Google. As I stated above, there are no ads to clutter up the page and lure prospective buyers from your listings. Dial up users will appreciate the speed in which the site loads over a analog connection.
Feedback System
The feedback system is simple and one-way. Buyers leave feedback for sellers — period. Recipricol and retalitory feedback is not a problem, because sellers don’t leave feedback for buyers. The buyer has the opportunity to leave feedback immediately if the purchase was made through an instant payment option and they are automatically sent a reminder three-weeks later if they have not taken the opportunity to evaluate the seller yet. Feedback is displayed as a simple percentage. For example, a seller’s feedback rating is 100.0 if they’ve received nothing but positive ratings and a seller that has received 3 positive and one negative feedbacks will display as 75.0. A detailed feedback page allows the visitor to read feedback comments and see the number of feedbacks received over the past year in a manner very similar to the classic eBay feedback page. There are no detailed seller ratings.
Listing Format
The listing format is fixed price only. The items are listed indefinitely (until sold) and the seller can offer multiple quantities. Every seller is provided a store with a short & simple URL. These stores include all of the merchant’s listings subdivided into categories defined by the seller. The owner can brand the store with their own logo and using the search function from inside the store will return only listings from that particular merchant’s store.
Restrictions and Terms of Service
There are significantly less restrictions than eBay users are accustomed to. In fact the site’s terms of service are only 899 words long! That’s less than some of the auction terms and conditions I’ve seen included by some sellers on eBay. The restrictions and terms are pretty straight forward. As of the time of this writing the site prohibits the listing of:
- Body parts & organs
- Pirated materials and products
- Copyrighted Materials (images & texts)
- Counterfeit Designer Items (replicas or imitation of designer products)
- Fake Documents
- Illegal Goods and Services
- Personal Information about another individual
- Prescription Drugs
- Prostitution
- Currency Exchanges
- The same or very similar content several times (even in different categories)
- Miscategorization
- Meaningless title & description
- Test items unless your store is put on-hold
- Free items and items with prices that are not “real”
- Items that are not for sale
- Pre-order items
- Firearms & ammunition
- Tobacco and cigars for smoking
- Live animals
- Mod chips or mod chips accessories
Community
eCrater boasts an active, friendly community. The lively bulletin board is reminisent of eBay’s in its early years.
Seller Tools
Besides the free store, eCrater offers an excel based bulk listing tool and offers free picture hosting. Each listing includes a gallery photo and the site boasts a shopping cart for visitors to your store. A widget and RSS feeds are available to promote your listings on your website, blog or Squidoo Lens. eCrater automatically submits a feed of active listings to Google Products Search (formally known as Froogle) and the listings support inclusion of Google Product Search attribute tags.
Simple Registration Process
I’ll document the registration process in a future post, but suffice to say that it’s quick, simple, and doesn’t require a credit card or any other financial data. While that’s a boon for sellers who desire a quick start and are concerned about the security of their personal financial information, it does expose the buyer to some risk. If it’s easy for honest merchants to establish an account and start selling, it’s equally easy for a fraudster to do the same.
Therefore it’s important for a seller to establish credibility and trust on their own website, blog, newsletter and/or forum community before they send potential customers to their listings on eCrater. Which leads me to my next topic:
Where Are the Buyers?
Here’s the rub. eCrater is not a natural destination for online consumers. The site wasn’t designed to be. It was designed to attract traffic from potential buyers directly to listings and stores from Google and through active traffic generation tactics on behalf of the seller. What I’m talking about is attracting free search engine traffic via the seller’s active blog or website, active participation (posting - not lurking) in forums relevant to your niche and including a link to your eCrater store in your signature file, Google AdWords campaigns, etc.
Success as a seller on eCrater requires work on your part to promote your listings — plain and simple. You need to attract buyers, establish a level of credibility and trust and send them to your listings. That’s the cost of free listings on a free store. But, for many sellers — this works! The chart below is a comparison of the traffic between three eBay alternatives from Alexa.com. The graph compares the Alexa rankings of eCrater.com, eBid.net, and UpperBid.com. The stats are from a live feed, but as of this writing, eCrater has a healthy amount of traffic relative to the other eBay alternatives.
eCrater is reminiscent of eBay in the early days — before it became wickedly corporate. I started this eCrator review primarily because I needed something to write about. Now I’m genuinely excited about participating in the site and sharing my experiences with you.
Look for part II of my eCrater review: Buying on eCrater.
Aug
4
As I discussed in my last post, eBay’s early success can be traced to the fact that the online auction was an early facilitator of the Long Tail economy. For decades, marketing efforts have concentrated on developing introducing products and services with mass-appeal due to the constraints of limited shelf-space and limited demand.
The internet provided merchants of niche products the opportunity to “aggregate demand [for these products] on a national or even global scale.”* eBay in particular was important to the development of the Long Tail economy because their online marketplace satisfied several important factors identified as key to the success of the Long Tail economy.
These factors are detailed in an MIT paper called, “From Niches to Riches: Anatomy of the Long Tail” and are divided into “Supply Side Drivers” and “Demand Side Drivers.”
Supply Side Drivers
As I noted above, traditional merchants were limited “by the same basic constraints: how many products can be provided in a limited amount of shelf space, and how many consumers in the local geographic area are willing to pay for these products.”* Brick-and-mortar businesses were confined to storefronts in expensive locations and could, therefore, only sell products that appealed to the mass-market. Niche items that had limited marketability to the consumers in their area were not a profitable use of their expensive shelf and warehouse space.
eBay helped change that. Merchants no longer needed to work out of high-rent storefronts in high-trafficked areas. Long Tail marketers could stock products of interest to niche communities in their garage or basement located in some remote part of the country. As long as they had a way to ship the products and access to the internet, niche sellers could use eBay market to a broad base of customers without the concern of the expense of a high-rent location.
Purveyors of Long Tail goods could count on eBay to promote their products to a global market. They were no longer constrained to the limitations imposed by traditional marketing venues such as print, radio and television advertising which would only reach limited audiences despite the significant expense involved.
Demand Side Drivers
eBay satisfied several key demand side drivers by providing consumers a centrals source and the mechanisms required to find the niches products that interest them. eBay accomplished this through organization and effective search tools. Before there was such thing as an effective search engine, eBay provided the central destination on the internet where consumers could browse for Long Tail products by category and sub-categories and/or conduct queries for specific items or features using their search feature.
There are several passive demand side drivers identified in the article which eBay has attempted (half-heartedly) to implement that are also important to Long Tail marketing. “Sampling tools, such as Amazon.com’s samples of book pages and CD tracks, allow consumers to learn more about products in which they might be interested.”* User reviews and recommendations also take some of the risk out of the equation for the Long Tail consumer. Additionally, “recommender” services such as NetFlix’s are an effective way of developing the niche marketplace based on the experiences of other consumers with similar tastes (eBay’s version needs some work! ). An eBay interested in developing into a mature Long Tail marketplace would certainly be well served expending some resources in developing and marketing these tools.
Where Does eBay Stand Now?
Alas, given the factors identified as significant to the success of the Long Tail marketplace, eBay seems content to implement policies and field technologies that move the auction site in the opposite direction.
Best Match is optimal for listings with mass-market appeal - not collectibles or niche items. This is in direct contradiction to the circumstances that made it popular and as the original niche marketplace to begin with - the effective organization and search.
eBay has tested the waters of user reviews and recommendations (so successful on Amazon), but has not devoted a significant amount of corporate effort into making these tools a significant feature on the site.
By implementing policies that are designed to encourage the listing and sale of products with mass-market appeal, eBay is implicitly discouraging the Long Tail market. The management has recently created a special category of Power Seller that provides special treatment for super sellers of mainstream products such as Buy.com. Additionally, eBay’s most recent promotion was aimed at increasing the number of fixed-priced listings - a selling format that is much more common in the mass-market product arena than the Long Tail market.
It’s ironic that as eBay implements changes to make it more like Amazon.com, Amazon is broadening their market to encompass more niches. Good thing for Amazon, especially since they have the tools to accomplish the task!
* Brynjolfsson, Erik, Hu, Yu Jeffrey and Smith, Michael D.,From Niches to Riches: Anatomy of the Long Tail. Sloan Management Review, Vol. 47, No. 4, pp. 67-71, Summer 2006
Available at SSRN: http://ssrn.com/abstract=918142
Jul
31
eBay: Long Tail Marketplace or Commodity Exchange? Part 1
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eBay is in a transition period. The auction sites early success was that of one of the world’s first “Long Tail” markets. eBay’s corporate vision seems to think that greener pastures lie in the realm of what is basically a commodities exchange marketplace.
What’s the difference?
A Long Tail market describes a niche strategy of business in which the market offers a large quantity of unique items in relatively small numbers. Chris Anderson coined the phrase, and published an influential book on the subject entitled, The Long Tail: Why the Future of Business is Selling Less of More.
This Long Tail concept in a nut shell is that there is money to be made in selling obscure goods to niche markets. The graph below provides a pictorial representation of the Long Tail concept. The vertical axis represents the popularity or mass market appeal for an item. The horizontal axis represents a particular product. For example’s sake, let’s call them DVD’s. The “Head,” the part of the graph that is shaded green, represents the popular, mainstream movies. This is where a significant portion of the market is concentrated - but not all of it.
Traditional markets typically are constrained to the Head (green area) because of physics:
- How many products can the merchant stock in a limited amount of space?
- How many customers in the local area are willing to pay for those products?
The niche strategy of business seeks to break these constraints by selling a large number of unique items.
The Long Tail
The yellow part of the graph represents the Long Tail. These are the movies that not everybody is interested in, but there are niches of people who would like to own or rent those particular titles. Your neighborhood Blockbuster is going to devote their limited shelf-space to the more popular titles in the green portion while, in aggregate, Netflix rents more videos from the Long Tail portion of the graph than the green portion.
The factors that keep most business models in the green section of the graph above deal with search, storage, and distribution. I’ll discuss these specific topics in greater detail in a future post, so let it suffice to say for now that the costs involved with marketing to small niches, storing the goods until they are sold, and distribution were so prohibitive for most entrepreneurs that most didn’t consider it a viable opportunity before the internet existed in its present form.
eBay’s early success has been in providing a marketplace for the Long Tail. The company provided a central location and a search mechanism for consumers interested Long Tail products to buy them, and a venue for Long Tail merchants to sell to this market.
The Consumer Commodity Exchange
Now eBay is heading away from their roots and focusing on becoming a venue for products that have a mass-market appeal. Even while more and more of the internet is becoming aware of the value of the Long Tail market (what Chris Anderson describes as “selling less of more”), eBay is focused on becoming what is essentially a consumers commodity exchange.
Economists define a commodity as something of value, of uniform quality, available in large quantities by different producers. Do a search for iPod or WebKinz on eBay and you’ll soon understand that these are basically a commodity.
The price of a commodity is universal and fluctuates based on supply and demand. There’s little profit for sellers of commodities unless they control some aspect of the supply or can successfully predict fluctuations in demand. Therefore, the sellers who will be able to compete successfully on the new eBay are not necessarily those who were able to compete successfully on the old eBay.
Why is eBay moving from the Long Tail market to the consumer commodities market?
- More consistency over who sells in their market and what’s selling. (Does this open them up to more piracy and counterfeit risk?)
- They think that’s what the consumer wants. (Didn’t Coke make the same mistake 25 years ago?)
- The think they will make more revenue. (After all, Amazon is growing.)
It’s worthwhile to remember that it’s the commodity brokers that make the most money in the commodites markets. They make a commission whether the market is going up or going down. The commodities traders (the new eBay sellers) are open to constant risk when they play the market - and are usually encouraged by the brokers.
Are you ready to play the market on the new eBay?