eBay Shifts its Business Model

As eBay makes sweeping changes to their business model, the sellers who built the goliath are re-examining their businesses as well… The thrust of this article is that eBay is moving and favoring a fixed price (or buy it now) model:

Auctions on eBay: A Dying Breed

Yahoo! News
By Catherine Holahan
Tue Jun 3, 2008

“Bruce Hershenson, who auctions vintage posters online, is hanging up his eBay gavel. For almost a decade, Hershenson’s business epitomized the e-commerce that made eBay (NasdaqGS:EBAY – News) famous. He sold rare, collectible, sometimes kitschy memorabilia in online auctions that had a starting bid of 99 cents. But as the business of buying and selling over the Internet has matured, the thrill and novelty of auctions have given way to the convenience of one-click purchases. Hershenson will hold his last eBay auction June 3. “The auctions are nothing like what they once were,” he says. “They won’t ever come back.”

…Perhaps the biggest example of eBay’s new fixed-price focus is the new fee structure, announced in January. The changes gave breaks to many large vendors who sell fixed-priced goods on the site, while hiking fees for many eBay users who sell using a traditional auction structure (BusinessWeek.com, 1/29/08).”

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