eBay: The First 10 Years.

Yes, you read that correctly: ten years. eBay was created in September 1995, by a man called Pierre Omidyar, who was living in San Jose. He wanted his site - then called ‘AuctionWeb’ - to be an online marketplace, and wrote the first code for it in one weekend. It was one of the first websites of its kind in the world. The name ‘eBay’ comes from the domain Omidyar used for his site. His company’s name was Echo Bay, and the ‘eBay AuctionWeb’ was originally just one part of Echo Bay’s website at ebay.com. The first thing ever sold on the site was Omidyar’s broken laser pointer, which he got $14 for.

The site quickly became massively popular, as sellers came to list all sorts of odd things and buyers actually bought them. Relying on trust seemed to work remarkably well, and meant that the site could almost be left alone to run itself. The site had been designed from the start to collect a small fee on each sale, and it was this money that Omidyar used to pay for AuctionWeb’s expansion. The fees quickly added up to more than his current salary, and so he decided to quit his job and work on the site full-time. It was at this point, in 1996, that he added the feedback facilities, to let buyers and sellers rate each other and make buying and selling safer.

In 1997, Omidyar changed AuctionWeb’s - and his company’s - name to ‘eBay’, which is what people had been calling the site for a long time. He began to spend a lot of money on advertising, and had the eBay logo designed. It was in this year that the one-millionth item was sold (it was a toy version of Big Bird from Sesame Street).

Then, in 1998 - the peak of the dotcom boom - eBay became big business, and the investment in Internet businesses at the time allowed it to bring in senior managers and business strategists, who took in public on the stock market. It started to encourage people to sell more than just collectibles, and quickly became a massive site where you could sell anything, large or small. Unlike other sites, though, eBay survived the end of the boom, and is still going strong today.

1999 saw eBay go worldwide, launching sites in the UK, Australia and Germany. eBay bought half.com, an Amazon-like online retailer, in the year 2000 - the same year it introduced Buy it Now - and bought PayPal, an online payment service, in 2002.

Pierre Omidyar has now earned an estimated $3 billion from eBay, and still serves as Chairman of the Board. Oddly enough, he keeps a personal weblog at http://pierre.typepad.com. There are now literally millions of items bought and sold every day on eBay, all over the world. For every $100 spent online worldwide, it is estimated that $14 is spent on eBay - that’s a lot of laser pointers.

Now that you know the history of eBay, perhaps you’d like to know how it could work for you? Our next email will give you an idea of the possibilities.

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Taking Advantage of “Slow” eBay Auctions.

Some auctions get hundreds of bids, but some go much more slowly, getting only a few bids or even none at all for days. Auctions are generally much slower during the summer months than they are in the winter - and sales on eBay are slowing each year, as more sellers than buyers sign up, hoping to get rich quick. There are a number of ways that you can take advantage of slower auctions to get the best price.

Wait to Bid.

If you bid, then everyone can see you’re interested - and that might make them interested too. Leaving the item alone for as long as you can bear will make it look less popular, and keep the price down so you can come in at the last minute and get a bargain.

Make an Offer.

If the seller is selling an item using ‘Buy it Now’ and it still hasn’t sold when the auction is about to end, use eBay’s ‘Best Offer’ service to make them an offer on it. The chances are they’ve listed the item two or three times before, and they’ll be so annoyed at the prospect of re-listing it yet again that they’ll accept your offer just to get rid of the thing.

Conspire with Other Buyers.

You might not have thought of this, but if there are two auctions for the same item and only you and one other buyer are bidding, why not get together and work out a ‘you take this one and I’ll take that one’ deal? This avoids you raising the price on both auctions just to get one each. If you make a few friends, you can even work together on auctions long-term, taking it in turns to bid.

Be Snobbish.

Send the seller emails asking questions about the condition of the item, and making it very clear that you are a discerning buyer and will only accept things of the highest quality. This will make them feel better about selling you their item for less.

Don’t Feel Guilty.

There really are too many sellers on eBay now, to the point where you can get common items at very low prices. Long-term, this will probably force those sellers out of business, but that’s the way a market works - it’s supply and demand.

Buy in Bulk.

When auctions are slow, many sellers will have had the same stock for a long time. If you offer to take ten things off their hands all at once then you can almost name your price - the chances are that they’ll fall over themselves to give you a good deal. If you come back again and buy another ten items then they’ll love you even more.

The longer you spend on eBay, the more experienced you’ll become - and the greater the chances are that you’ll stumble across an auction for something very odd, and quite unexpected. In the next email, you’ll hear all about the strangest eBay items ever sold.

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Tips for Buying Collectibles on eBay.

Buying collectibles is one of the most enjoyable things to do on eBay, simply because you can find so many things that you just can’t get anywhere else. Here are a few tips to help you on your way.

Find your Category.

You’ll probably find that all the items you’re after are listed in a single category. Add this category to your browser’s Favorites, and keep coming back.

Look for Mistakes.

If you collect something, the chances are you know a lot about it. This can be your opportunity to make a mint from a seller’s mistake. They might not realise that they have a rare version of an item, or they might have left off the key information that makes it valuable. If you’re willing to email the seller and ask them a few questions about the item to confirm that it is what you think it is, then you should be able to buy items like these. You can then resell them at a big profit, if that’s what you want to do.

Don’t Always Believe Descriptions.

If you find something you haven’t heard of, and the description calls it ‘rare’, don’t assume that it actually is. Far too many sellers just put ‘rare’ into all of their descriptions - the chances are that the item is common and has just been described wrongly. Don’t bid unless you know what you’re buying.

Stalk Other Users.

When you collect something, you’ll probably notice that there are four or five sellers who seem to come up with consistently good items - and the same buyers buying them. Add their user pages to your Favorites, and check back often to see what they’ve got - or what they’re bidding on - that you might be interested in.

Don’t Get Too Attached to an Auction.

There are millions of items being listed every day on eBay - whatever you want, it’ll come around again, and if you don’t get it there are plenty more things to buy. This is similar to the golden rule of negotiating: always be prepared to walk away. If you can’t walk away, then expect to pay over the odds. There are few things so rare that another seller won’t have one to sell. Go and bid in a lower-priced auction, instead of getting into a bidding war in one that is already expensive.

Beware of the Postage.

If you collect lots of small things with a relatively low value, you might end up paying as much for postage as you do for each item. You should take these costs into consideration when you make your bid. Another good strategy is to always buy a few things at once from the same buyer, as they will almost always offer you a discount on the postage.

When you’re bidding, you might notice that some auctions go more slowly than others, going days at a time without any new bids. The next email tells you how to take advantage of these ’slow’ auctions.

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Watch Out for eBay Automobile and Computer Scams.

There aren’t that many scammers on eBay - but the ones there are tend to be greedy. This means that they will always try to pull their scams on high-value items like cars and computers, so that they can make a lot of money quickly. Since buyers generally buy these items very rarely, they may not know about the various scams out there.

Automobile Scams.

With cars, you will generally find that scammers try to get you to send them money in advance, for whatever reason. For some reason, some people aren’t all that reluctant to pay 50% or 25% of the money before delivery using a relatively insecure payment method, especially on a car. They reason that the seller will obviously deliver it, as they’ll want the other half of the money.

But there never was a car! Pictures of cars aren’t hard to find, and the experienced scammers will have a whole library of pictures of different cars. The seller just got your $5,000 for nothing, and you can leave them all the negative feedback you like. They’ll just go and open another eBay account and find their next sucker.

While it’s not an outright scam, what you might find is that the car does turn up, but simply doesn’t live up to the description - it has been oversold, in the tradition of used car dealers through the ages. If this happens to you then you should open an eBay dispute and say your item was not as described - you might get a partial refund.

Computer Scams.

If you bid in a computer auction but don’t win, the seller might email you to ask whether you would like to buy a computer the same as the one they just sold through their own website.

This is a bad idea! You have no guarantee that the item will ever arrive, and you haven’t just given them your money - you’ve given them your credit card details too.

There are sellers with nothing but positive feedback who use this scam often - and since you won’t be able to leave them any feedback on the transaction, their reputation will stay that way. If you complain to eBay that you bought an item outside the site and got scammed, they will tell you to get lost and not do it again.

How to Beat the Scams.

There are lots of ways to beat the scams. First, whenever you buy anything expensive, be sure to check your seller’s reputation thoroughly. Make sure they have sold items of a similar high value before, and haven’t just sold a string of $10 items to get their feedback rating artificially high. If you want to be even more cautious, insist that the money is placed in an escrow service (eBay recommend escrow.com - don’t use any other service unless you’re sure of it).

To be honest, it’s generally quite a bad idea to use eBay to buy things like cars and computers to begin with - you can get them anywhere, and the discounts aren’t that big any more. It’s better to use eBay for those rare, special things that you can’t find anywhere else. The next email will give you some tips for buying collectibles.

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When Things Go Wrong: How to Resolve eBay Disputes.

eBay has quite an intricate and long-winded dispute resolution procedure. In this email, I’ll try to break each step down for you, so you can see what’s involved and how long it takes.

As an example, let’s go through what you would do if you paid for an item but didn’t receive it from the seller.

Before you open a dispute: Give the seller a chance to send the item before you get ahead of yourself and open a dispute. If you’re concerned about how long the item is taking to arrive, the first thing you should do is send a polite email to the seller saying that you haven’t received it and asking whether they have posted it. You should also check your own email address in eBay’s options, to make sure that the seller can reply to you. As a last resort before opening a dispute, you should try to call the seller on the number eBay has for them. You might have to pay long-distance charges for the call, but that’s better than dragging the auction through mediation for months.

Step 1 - You open an Item Not Received dispute: You can do this here: http://feedback.ebay.com/ws/eBayISAPI.dll?InrCreateDispute.

All you need to do is enter the item number and say that you did not receive the item.

Step 2 - eBay contacts the seller: eBay sends the seller an email that tells them that you’ve said you didn’t receive the item. Then can then choose to tell you one of three things: that your payment hasn’t cleared yet, that the item is in the post, or that they’ll give you your money back. The seller can also tell eBay that they would like to send you a message.

Step 3 - You talk to the seller: You try to work out what’s happened directly with the seller, sending messages back and forward. Hopefully they’ll agree to give you a refund for the sake of their feedback, or your item will turn up in the post during this time.

Step 4 - Closing the dispute: After 30 days (or 10 days if the seller didn’t respond), you have two options to close the dispute: either you were satisfied or you weren’t. If you weren’t satisfied, then you can claim under eBay’s purchase protection program for up to $200.

Independent Dispute Mediation.

If you don’t want to go through eBay’s own process, and especially if the auction was for a high-value item, then you can use a third-party mediator. eBay recommend SquareTrade, at www.squaretrade.com, who provide mediation to many websites where there are buyers and sellers. They will contact the seller on your behalf and then mediate as you negotiate what to do from there.

Sellers who are committed to going through SquareTrade’s mediation for any disputes can sign up to display the ‘SquareTrade seal’ on their auctions. This gives their buyers $250 fraud protection, and shows that their identity has been independently verified so they are who they say they are.

When your sellers aren’t in such good standing, though, you need to be careful to avoid being a victim of fraud. There are a few scams that you especially need to look out for - we’ll cover them in the next email.

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