eBay facing problems

Posted on September 30, 2006. Filed under: web 2.0 |

I just read this pretty interesting article about ebay’s declining popularity. I don’t think eBay will be losing too much sleep just yet as i’m still sure they can afford pretty comfortable beds but it does make me wonder about online trading in general. I’ve been thinking for a while that auctioning is quite ineffective and lacks efficiency. will be interesting to see how this develops.


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2 Responses to “eBay facing problems”

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“auctioning is quite ineffective and lacks efficiency”

Is it, really?

Well to quote Adam Cohen, who wrote The Perfect Store: Instore ebay:

“Auction theory teaches that auctions are not, in fact, an efficient way of selling most goods. They are too labor intensive and time consuming for items that are likely to sell at a price the parties could have anticipated in advance”.

Half .com is the perfect example of a site that thrived on the inadequacies of the auction model for items where the market rate can be determined in advance (I should mention that Kul was the one who pointed this out to me so I can’t take credit).

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