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What I don't get about eBay is they found initial success in being an auction site then they almost immediately decided they wanted to be an online retailer ins

by cletus 9y ago

What I don't get about eBay is they found initial success in being an auction site then they almost immediately decided they wanted to be an online retailer instead. Why not just be the best auction site you can be rather than be yet another Amazon wannabe? Interestingly Amazon has done the same thing except they want to be Google (Android) and Netflix (content bundling with Prime). I get the desire to grow but honestly more often than not trying to do too much just makes you mediocre at everything.

swlkr 9y ago
Amazon does a decent job at prime originals vs. netflix originals.
uw_rob 9y ago
> What I don't get about eBay is they found initial success in being an auction site then they almost immediately decided they wanted to be an online retailer instead. Why not just be the best auction site you can be rather than be yet another Amazon wannabe? I recently read a book [0] that outlined some of the reasons why that happened. Two of the main reasons outlined were: (1) As more and more people started selling on the site, items started to become commodities with fixed prices. So even old antiques started to have a fixed value. This encouraged more people to just buy it now. (2) Even by the mid 2000's, when ebay was still considered mainly an auction site, only a very small fraction of sales were made by auctions. Something around 90% of sales were buy-it-now new items. This meant that their real success was in buy-it-now and they started to focus on that. (Don't quote me on the numbers in the second part, I will try to get more accurate ones later). So they had a lot of initial success in being an auction site, but there isn't really much of an market for a general purpose auction site. And once you become a succesful auction site, you basically stop being a auction site. [0] I cannot remember the name right now and I cannot find it. It was about providing real world examples of famous economic papers. It covered wide ranges of topics about used cars prices, trading in prison camps, ebay. It was released in 2016.
- Luc 9y ago
  The one about used cars could be 'The Market for Lemons' by George Akerlof. https://en.wikipedia.org/wiki/The_Market_for_Lemons https://en.wikipedia.org/wiki/The_Market_for_Lemons
- DroFlow 9y ago
  That's interesting. But, paradoxically, I stopped using eBay when it stopped being an auction site. The possibility of getting a rare deal, plus the "game" of bidding, was what made it attractive.
adventured 9y ago
> rather than be yet another Amazon wannabe Amusingly, seeing eBay's profitability early on, Amazon tried to build on an eBay wannabe product and failed miserably at auctions. eBay has had the segment to itself ever since. Why didn't Amazon solely focus on being the best retailer it could be, instead of pursuing a foray into auctions? They couldn't help themselves, they saw the $$$ eBay was earning, as Bezos did with the iPhone margins. And while I fully understand the reasons for the valuation difference, I still find it hilarious that eBay is generating roughly as much net income annually as Amazon, at 1/12th the valuation.
- gscott 9y ago
  Years ago Yahoo had an auction website. Every auction website except ebay has failed.
dionidium 9y ago
Etsy, eBay, etc. Clearly retail is a bigger overall market, so they can't resist.
deleted 9y ago
[deleted]

by cletus 9y ago

swlkr 9y ago

Amazon does a decent job at prime originals vs. netflix originals.

uw_rob 9y ago

> What I don't get about eBay is they found initial success in being an auction site then they almost immediately decided they wanted to be an online retailer instead. Why not just be the best auction site you can be rather than be yet another Amazon wannabe? I recently read a book [0] that outlined some of the reasons why that happened. Two of the main reasons outlined were: (1) As more and more people started selling on the site, items started to become commodities with fixed prices. So even old antiques started to have a fixed value. This encouraged more people to just buy it now. (2) Even by the mid 2000's, when ebay was still considered mainly an auction site, only a very small fraction of sales were made by auctions. Something around 90% of sales were buy-it-now new items. This meant that their real success was in buy-it-now and they started to focus on that. (Don't quote me on the numbers in the second part, I will try to get more accurate ones later). So they had a lot of initial success in being an auction site, but there isn't really much of an market for a general purpose auction site. And once you become a succesful auction site, you basically stop being a auction site. [0] I cannot remember the name right now and I cannot find it. It was about providing real world examples of famous economic papers. It covered wide ranges of topics about used cars prices, trading in prison camps, ebay. It was released in 2016.

Luc 9y ago
The one about used cars could be 'The Market for Lemons' by George Akerlof. https://en.wikipedia.org/wiki/The_Market_for_Lemons https://en.wikipedia.org/wiki/The_Market_for_Lemons
DroFlow 9y ago
That's interesting. But, paradoxically, I stopped using eBay when it stopped being an auction site. The possibility of getting a rare deal, plus the "game" of bidding, was what made it attractive.

adventured 9y ago

> rather than be yet another Amazon wannabe Amusingly, seeing eBay's profitability early on, Amazon tried to build on an eBay wannabe product and failed miserably at auctions. eBay has had the segment to itself ever since. Why didn't Amazon solely focus on being the best retailer it could be, instead of pursuing a foray into auctions? They couldn't help themselves, they saw the $$$ eBay was earning, as Bezos did with the iPhone margins. And while I fully understand the reasons for the valuation difference, I still find it hilarious that eBay is generating roughly as much net income annually as Amazon, at 1/12th the valuation.

gscott 9y ago
Years ago Yahoo had an auction website. Every auction website except ebay has failed.

dionidium 9y ago

Etsy, eBay, etc. Clearly retail is a bigger overall market, so they can't resist.

deleted 9y ago

[deleted]