The Wholesale Forums

[mgs2]

Thanks for the reply anotheruser. I understand the timing is different now. But what I would point out, is that theory I have put forward is signifcantly different to the oztion model. I would advice that there be no final valuation fees, hence a truly free to entry market, catering to the interests of sellers.
Also I would try to mimick eBay's interface, thereby have a much better interface than oztion.

Therefore I would point out that the end result, is a model that is more attractive to sellers, because of less fees and a better interface. Do you not believe there is a place for this a chance for this new online auction model?

[Pete]

How deep are your pockets? It's going to take a lot more than some pocket change and a free auction script from Fantastico.

[anotheruser]

This is going round in circles. Where are your revenues going to come from? You need to get it out to potential users, which will cost money. In the unlikely event that you achieve visitor numbers, how are you going to maintian it on the revenue model you have outlined?

Pete is absolutely right. It is going to be a very costly exercise indeed. If you think you can afford it, give it a try by all means. I actually believe it is a silly way to go broke.

[mgs2]

Thanks for the posts.

The initial revenue would come from 2 sources. One ads on the site (probably initially using google ad sense). The other source would be from sellers who use additional features like bold, highlight etc. That would cost money.

Initially the site would attempt to use free and inexpensive advertising to grow visitors. I believe that the problem would be creating a base of sellers who regularly sell on the site, when starting from nothing. I think there would be a great deal of uncertainty in this particular element. But I believe with the model I mention, I could take the best elements of ebay and oztion, 2 highly successful sites.

[Pete]

Forget the revenue. That's not what I'm talking about. Most of the big online sites were started with venture capital. Seed money. Cash to live on while devoting 18 hours a day to the chore. Marketing money for ads and promos, press releases, build momentum before the actual launch.

What you propose is not a kitchen table undertaking. You're not going to put up an auction script and have revenues that will sustain you during the startup. You are talking about going head to head with a well financed world leader. You need some horsepower behind you. You need a well thought out business plan and some investors who will fund you through the startup and then some.

It was years before Amazon turned a profit. It will be the same for you.

[mgs2]

Thanks for the reply. In this regard, I was thinking of using purely free and low cost advertising methods. Getting the word out on forums and blogs etc. and using google adsense. Hence no venture capital would be needed.

What do people think of this idea?

[Pete]

Been tried thousands of times. Literally thousands. Even when eBay was nowhere near what they are now. I can't tell you how many of those free scripts have been put up, but get little traffic.

The sellers think they are getting a great deal - free ads. But with no buyers they soon give up and you have no sellers.

There are many sellers who hate eBay, but they'll all tell you it's where the money is.

I'd say concentrate on the blades thing.

[mgs2]

Thanks for the replies to my posts Pete, I really appreciate your feedback. My curiousity with this issue comes from the evident success of oztion. Wouldn't oztion have started with a very low cost business model, based on free and inexpensive advertising?

Do you think its a better idea to target a certain component of online auctions rather than competing with all of eBay. For example an online auction site that just focuses on services (just recently added by eBay). Do you think this type of model is better than one featuring all categorie?

[anotheruser]

This is not an auction, but an advertising, site which works on the principles you are espousing. Check out Adooda's performance through Company's House (find out who owns it with a WHOIS, or see what info you can find on the site first) to give yourself a better idea of costs and viability.

[MustHaveMobiles]

If you are determined to pursue it then simply get on with it, initial plans mean relatively low expenditure on your account but it really is a massive mountain to climb. Although stranger things have happened and mightier websites have be surped by others...