furnishings.
Westly says that even in specific categories, eBay has more buyers and sellers than most specialized auctions. Even on Amazon and Yahoo, he points out, conversion rates (the percentage of auctions that result in a sale) are far below eBay's. [See chart]
Nevertheless, it's possible that eBay's enormous edge could wane. Currently, sellers get a premium for trading on eBay: The more buyers bid on an item, the higher the selling price. As the number of buyers in a marketplace grows, so does the average price of items.
But once a site achieves a certain critical mass, the selling price stops growing or grows at a slower rate. In other words, a site with 1 million buyers is sure to give a premium to sellers over a site with 100,000 buyers. But the premium awarded sellers by a site with 10 million buyers over a site with 1 million buyers is likely to be smaller. In that case, the smaller site could actually be more appealing for sellers, as it is less cluttered and items are easier to find.
That's already evident, according to Hakan Senkal, a 43-year-old coffee-shop owner who began selling used books and magazines on eBay in April but switched to Amazon shortly after. Senkal, who manages his auctions with a laptop computer whenever business is slow at his drive-through espresso stand near Seattle, says Amazon already attracts millions of book buyers to its site. Many of them are ideal prospective customers for his merchandise.
Plus, Senkal faces less competition from other sellers. "EBay is highly saturated," he says. "If I put a Life magazine from 1940 for sale as a collectible, I'd find a dozen other sellers [there] with the same magazine." Currently, Senkal has 1,486 auctions on Amazon and 364 books listed on zShops, in addition to the 125 books he's sold on zShops in the last month. He adds that conversion rates are higher on Amazon than they have ever been on eBay.
As marketplaces proliferate, they are likely to compete not only on the basis of selling prices, transaction fees and conversion rates, but also on services. These range from easy uploading features and shipping to escrow services and insurance against fraud - offerings first rolled out by eBay.
Some companies also are providing services that let buyers and sellers operate on multiple auction sites simultaneously. They make it easy for sellers to post similar items on various sites, allowing buyers to search for a specific item across marketplaces. EBay has sought to bar some of those companies from searching its site, saying it wants to protect the entire seller-buyer experience it provides shoppers. But critics say the company is simply trying to protect its market share.
"Markets can try to lock things up," says Munjal Shah, Andale's president and CEO. "But eventually they have to compete. There should be no friction in switching markets."
However those disputes are resolved, a proliferation of marketplaces is certain to benefit buyers and sellers alike. For now, Satchouk says, she does not pay attention to all those debates. "I never surf the Web," she says. "I just go to eBay and do my banking online."
Yet the thriving business that started with a white wedding dress is still in its infancy. Satchouk is talking about branching out. One particularly appealing idea is using some of the vintage pottery she buys to make gift baskets. Coffee and tea sets would go well with English teas, and perhaps she could add candy or shortbread cookies. "I have so many ideas," she laments, "but so little time."
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