Everybody from the press to your aunt (who just made some serious
bank on her antique teacups) seems to have a place in their hearts for
eBay. But for those in the following five industries, eBay has caused a
bit of stress for those who have failed to adapt to its influence.
1) Computer / Server Hardware
It was 4:00 PM on a Thursday afternoon and it had been a long week. One of my best clients called in regarding a Cisco Switch
I had quoted him earlier that month… “I really want to pick this up
from you, but my manager searched this on eBay and found it for 10%
cheaper. Can you come down a little?”
Luckily, we sell used Cisco and typically have comparable pricing to
eBay. If we were a manufacturer or a new reseller, our price probably
would have been off by 50% or more!
Manufacturers, resellers and remarketers have all faced price
pressure from our clients who compare us to eBay. The fact is, you’ll
(almost) always receive enhanced assurance and added value by working
with a reseller and forming a long-standing partnership. Nonetheless, it
has become imperative that IT Hardware resellers take extra measures to
add services, resources and trust.
Back to the example above. My client forwarded me the auction listing
for the used Cisco switch. It turned out that it didn’t include power
cords and slot-covers and it was offered “as-is” without any warranty…
We got the order Friday morning.
2) Jewelry Industry
Sell an old diamond ring to a storefront jeweler, and you’re bound to
get much less than you could reap in an online auction. On the flipside,
the jeweler is losing a sale to the person who purchased the used gem.
While there are concerns about authenticity and the fact that many like
to see a diamond or other jewel in person before purchasing, eBay often
still wins out.
Take the following snippet by an online jeweler directly from an eBay review page:
"There was a time when consumers went to what they thought
was the ‘source’ (the New York Diamond District) for their diamond
purchases, however, over the years, those who want to keep up with the
competition (in New York) have actually opened eBay stores and conduct
auction events in order to move their merchandise quickly (especially
during non holiday seasons).”
Many jewelers have adapted by creating their own eBay stores and
others instead decided to focus on the high-end of the market and market
their expertise and prestige.
3) Flea Markets
The Flea Market circuit has had to feel the pain of the online
marketplace. How would you feel about sitting in the rain, trying to
sell vintage road signs and painted hubcaps when you know you could just
list them online instead?
I think the flea market is enough of an event to retain most faithful
shoppers, but many of those visitors check eBay pricing from home
before they head out. Thus, not even the flea market tables can escape
the price pressures of eBay.
4) Coin Dealers
Before 1995, there were millions of coin collectors, but only a handful
of true coin dealers throughout the world. When eBay came around, the
industry was turned on its head.
Individuals are buying coins at online auctions with little education
in the process. Some coins might be listed at ridiculous prices online,
making them terrible investments. Collectors have reported that
lower-priced coins tend to sell for more than they’re worth, while
higher price coins lose their value as the miseducated masses become
Those coin dealers who have become relentless online marketers have
built quite a strong tool to market their products outside of their
local shops and road shows. eBay is a huge marketplace for them to draw
in buyers to their inventories.
5) Professional eBay Sellers
Ironically, many of those who initially gained so much selling at eBay
auctions were unable to adapt to increased competition, changing markets
and increased listing fees – and ended up having to go back to their
In a Salon.com essay, Doomed by eBay, Claudia O’Keefe recounts her success, then eventual failure as an eBay seller.
“It was a
beautiful dream, but a stupendously arrogant one on my part. I fell
under the giddy, deep drink of individual Internet commerce, and it has
In the end, even the everyday auction sellers have felt the eBay effect.
Truth be told, the open marketplace is terrific for the consumer. But
most of these markets have felt great pains because they end up
essentially being the middleman. However, the leaders in these
industries have either learned to adapt to the new marketplace, or have
built up added value and assurance to their products.
Later this week, we’ll discuss what Vibrant is doing to add value for our clients and become a leading reseller of servers, storage and networking in the eBay era.
(Article 1 of 5 in our eBay article series)