eBay

toc The concept of eBay was originally derived as a convenient medium to trade and sell PEZ dispensers; [|eBay] was founded in September 1995 by Pierre Omidyar. Today eBay has become the largest online auction and shopping website in the world, providing a platform for for individuals to buy and sell both new and used products and services.

=Setting Up An eBay Account=

When setting up an eBay account you are required to give eBay a valid email address. If this address is a registered email address (i.e. issued by [|Cogeco], [|Rogers] etc.) you are not required to give a credit card number. If, on the other hand, you are signing up using an anonymous email (one that cannot be directly traced to you) such as those offered by Hotmail, you are required to give a credit card number. In some circumstances a mailer can be sent to the mailing address given by the user, which when returned, confirms the address.

=**Features of Ebay**=

**Seller Features**
As an eBay seller, you are given the opportunity to sell your items to the highest bidder. This could work in your favour, or it could work in favour of the buyer. Hopefully at the end of the transaction both parties are happy and willing to do business with each other again. When selling on eBay, there are a number of features that you are able to take advantage of:

Shipping Calculator
Sellers can also include a shipping calculator in their listing (a feature offered by eBay). Although the shipping calculator typically only works for sellers selling within their country of origin (i.e. New York can easily calculate shipping from Arizona, but not from England), it can be set up to calculate for countries all over the world. The shipping calculator makes it very easy for the buyer to find out exactly how much their shipping charge will be, having to contact the seller and wait for his/her response.

Advertising
Sellers, when listing their item, are given the opportunity to “advertise” their listing. Sellers can have their listing bolded, featured or be at the top of the page (This is a good feature because typically the listings are organized by time remaining or price). Seller also has an option of listing their item with a promotion picture where the picture of the item up for auction will be displayed when an individual searches for it. These extra features that eBay offers can help get your listing noticed but do come with a certain fee if the advertisements are applied.

Feedback Rating
A user’s feedback rating shows how much credit they have as a buyer/seller. Every time a buyer/seller participates in an auction via eBay they are given the opportunity to leave/receive feedback upon completion of the transaction. Since most of the buyers/sellers on eBay are relatively anonymous, users are always conscious of their own feedback rating, striving to keep it perfect. Sellers should make note of these rating during the bidding process to ensure that the bidders are trustworthy. If a negative rating is given on both ends and they want to resolve it, they are able to negotiate and withdraw that negative feedback that affects their reputation. Usually, you are given a month to give the feedback, if by then you haven't then you lost the chance.

Buy It Now
Sellers may not want their listed item to be “bid” on for a set period of time. This may or may not be a result of time constraints. If a seller has duplicates of the same item listed, they can offer a “buy-it-now” feature, which allows the purchaser to bypass the bidding process and buy the item at that point in time. The seller can then specify a timeframe/quantity which will determine the length of the auction.

Reserve Price
Sellers can also decide to set a “reserve” price. A reserve price sets the minimum amount that the seller is willing to accept before the listing becomes an enforceable contract. Normally, if there is no reserve price, the seller is bound to sell to the winning bidder, regardless of the price. Reserve prices ensure the seller that they will receive at least the amount they want, but can also deter bidders from participating in the auction. Setting a reserve price is not free. The seller will have to pay a fee depending on the reserve price.

Second Chance Offer
If a seller has more than one bidder on an item listed, after the auction has ended they can offer “Second Chance Offers” to the non winning bidders. The seller can choose which bidders he or she would like to send the offer to. The seller must determine the length of time the offer will be valid for, and the second chance offer is sent to the bidders as a “Buy-it-now” price in the amount of their highest bid.

Listing Revisions
As a seller, at any time during the listing you may revise you r item’s description or picture. Revisions do not actually change the information placed in the listing, but supplement it. When a revision is made, the revision is added to the bottom of the description. Revisions are not ideal because they leave the buyer wondering if it will change again (This can deter bidders)

Canceling Bids
It is not uncommon for a seller to have to cancel a person’s bid. There are a number of reasons why this might be the case.


 * Zero Feedback Rating – Often sellers are hesitant to sell to buyers with a zero (or negative) feedback rating.
 * Bad Etiquette – It is bad eBay etiquette for the buyer to attempt to end the listing prematurely without using the bidding process
 * Out of Area – The bidder may not have realized that they seller will not ship to their country of residence.

Bid Retraction
If a buyer changes their mind after placing a bid they are given the chance to retract their bid (given a few constraints i.e. 12 hours until bidding end, etc.). Buyers should be hesitant to retract their bids because this is also reflected on their feedback page (NOTE: Bid retractions do not directly effect the feedback rating)

Dispute Console
The “dispute console” that eBay provides, allows for a buy/seller to put through a claim if their item was never received/paid for. Once the claim has been made the other side of the party (buyer/seller) is then given a chance to explain (i.e. the item was sent via Canada Post Small Packet Surface Mail). Once the other party responds, it goes back to the original party, who then must in turn respond. This usually goes back and forth, getting nowhere (but pressures the opposite party to live up to their side of the bargain if they haven’t already) until 90 days from the auction end has passed, when the dispute closes automatically.

Freedom of Payment
As the buyer, you are able to choose which of the payment methods (offered by the seller) that you would like to use. Typically the choices include:
 * [|PayPal] – An online means of sending/receiving electronic money transfers, e-checks etc. This is the quickest (and usually most preferred) method of payment.
 * Money Order – Buyers can also purchase a money order (either at the bank or the post office) and mail it to the seller. The mailing must be done at the expense of the buyer.
 * Cash – In some circumstances you can send cash

Guarantee
When buying items on eBay you are given more of a guarantee then if you are selling. Then you are selling, you may or may not sell the item at all. If you are buying, as long as you are willing to pay enough, you can purchase any item you want. Through the large selection of products available on ebay, it will guarantee that there is a variety of products to choose from to ensure their customers can find the item under the value they like to pay.

Considerations When Buying/Selling on eBay
Often things on eBay may seem like good deals, but once you calculate the shipping and handling, as well as any currency conversions, it may end up being more expensive then you had originally thought. Also, people (especially initially) tend to buy things that they don’t need, resulting in the accumulation of debt that would otherwise not owe.

=The Ebay Monopoly=

Ebay has effectively patented a particular business process that it uses - auctioning. Conventional auctioning in a physical form is cannot be patented - it would be like saying McDonald's can patent the Drive Through process of ordering food, it can't since its logical. However, in the realm of the internet it is different. Therefore Ebay applied to UPSTO for a patent with its "auction business process" and recieved it - hence protecting it as the only website to facilitate auctioning, however, priceline had developed the reverse auctioning process yet it too patented it.

=Advantages (benefits)=

Conducting Business on eBay is Simple and Accessible
Neither the buyer nor the seller have to travel anywhere as eBay makes ones shopping spree not just a click way but also cost effective. Thus a transaction can occur from any location in the world with internet access.

More Options
eBay provides a buyer with various options whether or not he or she had been looking for something in specific as a vast variety of products are listed for sale from a diverse community of individuals and business. Whereas the sellers are provided with an opportunity to reach out to numerous potential customers all over the world and get a fair price for their products. Most often the seller has a picture of the actual item in its current state instead of a company photo of the product. This ensures that the buyer can view the individual item he or she is purchasing.

A Viable Online Price Indicator
eBay provides it users with an insight and price update of certain commodities. In addition, it allows them to compare the price of similar products already on sale prior to listing a product for sale or buying one.

Bargain products
By shopping on ebay it also allows individuals to bargain shop for items that are particularly high in price on the market. By having an auction, shoppers can find certain products that may meet their desire as well as their financial budget because people are constantly selling similar if not exact items from retail stores. If you bid correctly and are lucky enough then you can get an expensive item for at a much cheaper rate.

Entertainment
eBay certainly provides it users with entertainment as they are able to look for unusual items and also enjoy colorful graphics and pictures of items listed for sale which in most situations even allow them to make a judgment on the condition of that item.

Lower Cost of Operation
Compared to traditional business, eBay requires less labour, channels, and other costs to run a firm. As a seller, all it takes is the fee to advertise your auctions and the cost of your products. A standard listing with no special features usually costs $0.15 but on certain days, eBay would offer cheap listings such as $0.10 or $0.05 listings. There is no need to run a retail store and pay for other expenses. For individual/personal eBay users in Canada, no tax are required to be paid to the government but in some US province such as California, a small percentage of sale tax are required to be paid to the government. However, buyers are often asked to add the sale tax on top of the bidding price.

The Perfect Market
The auction process forces people to readjust their price points and recalibrate their desire for them. If you're outbid on an item, you have the choice of letting it go and upping the ante. Additionally, the site brings together buyers and sellers who would have never entered each others orbit in the real world.

Incentives
Along with these great benefits, eBay encourages even more transactions via advertising itself to current eBay users and new ones. eBay consistently offers certain days for cheap listings (a standard one is 15 cents, so they often lower it to 5cents or even 1 cent listings) to encourage people to sell more. As well, on certain days, they would offer free express shipping and such to encourage people to buy more, but usually this would mean that the price/starting bid is quite high.

=Disadvantages=

Condition of Item Hard to Determine
Since the buyers are unable to physically examine the item itself, it is hard for them to determine its real condition; as a consequence they are never able to make a fully informed decision.

Additional Fees
Depending upon the conditions agreed upon, there is an additional postal fee that has to be paid for the item to be shipped, often by the buying party. Moreover, dependant upon the value of the item, there may also be some additional custom charges that may be applied with reference to the taxation laws. Canadians who import from the U.S. are usually required to pay customs tax of 15% of the product value when purchased from actual companies but are omitted of this tax if purchased from a person who does not have an actual company. If the product is shipped via UPS, it is delivered to your door and will charge you the customs tax in person. Many people do not know what custom charges are and often are surprised by the amount they must pay in order to get their package. Of course, the greater the value of the product, the more you'll have to pay, especially electronics. So if you think you got a great deal on eBay, double check on customs first!

Higher Risk
eBay is a virtual place where one deals with unknown people, some of them potential fraudsters, scamming innocent users. There have been internet frauds worth thousands of dollars. These people then leave negative feedback on e bay, thus not a lot of people will be willing to shop online from the website. It is also a higher risk when a consumer are forced to give their credit card information on the Internet in order to buy products.

Lack of Communication
All transactions on eBay are through the internet and because of this, users are limited to communicating with the seller or buyer since they can only reach each other via email. Often, there is miscommunication of the product or the transaction process, which leads to negative feedbacks.

Lack of Socializing
Shopping on eBay certainly discourages its users to go to socializeand therefore prevents them from meeting their friends and doing the minor exercise of walking around. When a persons needs can be fullfilled by sitting on a comfortable chair, infront of the computer monitor, then making an effort to accomplish the same task may seem useless.

Rely on Technology
All eBay activities must rely on a digital device (pocket PC,PDA, cell phones) with internet access connection. eBay cannot be working without these technology therefore it could be controlled by the lack of electricity. For instance, the Ontario black-out in 2003 summer for few days caused huge loss of profit.

=Tips for Using eBay=


 * To increase your chances of winning an item in an auction is to add the particular item to your "Watched items" list and have eBay notify you by email when the auction is approaching its end. Within the last 2-5 minutes of the auction, if the item is at a reasonable price and your still interested in winning the item then place you bid slightly above the highest bid and watch as you win your item hands down. (//Placing your bid close to the end of an auction limits the chances of another bidder from placing a higher bid than yours.//)
 * The best method of payment using eBay is PayPal. PayPal is safe and secure and is good at resolving payment conflicts. Best bet is to buy\bid on items sold by eBay sellers that accept PayPal as a form of payment. PayPal lets you accept credit cards, bank transfers, debit cards, and more at some of the lowest costs in the industry.
 * Always check the shipping on the items you would like to buy/bid on. Some sellers do not mention the exact shipping price for your country and it is always good to know when determing the total cost of te item.
 * Always check the profile of the seller. A profile is a good indication of what sellers are trustworthy and what sellers are not. A high rating anywhere between 97%-100% is a good sign and high number of stars is also a good sign. Always read the table of positive to negative to neutral feedback, this table will show how often customers have complained and how often customers have been very satisfied with their service. This table also shows the most recent negative feedback, recent negative feedback is not a good sign, think twice before buying from that seller. Also a large amount of negative feedback is caution for you to buy from someone else.
 * For international sales, check for curreny conversions from the list price currency into your currency.
 * Compare items before bidding or buying. Some sellers offer the buy it now option on an item which may be cheaper than the same item with a higher bidding price (reserve). Also some sellers may offer deals on items, 2 for 1 or an extra item when you win\buy the original item.
 * Never hesistate to contact a seller in reagrds to a question you may have. You can determine the reliability and credibility of a seller based on how long it takes them to respond to a question and in how they respond to a question. Beware of sellers that take a longtime to answer a question or do not respond.
 * If shipping time and cost are a big issue, one good way of reducing shipping time and avoiding high shipping costs is to refine your searches to items located within the same country or better yet the same province. The closer the item is to you, the less time it will take to arrive to your destination and typically shipping cost will be lower. Also if an item is really close by, some sellers may offer the option of "Pick-Up" where you can go pick up the item from the seller. This means the only shipping related cost you have to worry about is gas expenses and possibly food for your trip if need be.
 * ALWAYS remeber to read the item description in full before making any purchase, no matter how long it may be. Some scam artists will fill their item descriptions with technical information, or uninteresting and non necessary points, and then in very small font, or hidden within the information, they may state some feature and/or aspect of the item that may be defective or not attractive to buyers. Then if you receive the item and you do not approve, they may refuse refund or exchange due to the fact they mentioned everything in the item description.
 * Also remember to at least skim through the eBay contract agreement and its policies, because if something goes wrong, eBay may compensate you under certain conditions. Also Paypal offers similar policies. Another reason, if anything goes wrong, eBay may take action against the culprit (buyer or seller), but again depending on whether certain conditions are met as stated in the contract agreement.
 * eBay University is a new service presented by eBay to help new members learn how to use eBay at its full potential. eBay University is a one-time seminar that takes place in major cities across North America.

=Works Cited=

David. Pros and Cons of Buying on eBay. 20 February 2006. < http://www.hotlib.com/articles/show.php?t=Pros_And_Cons_Of_Buying_On_Ebay >

O'Connel Patricia. eBay: In Praise of the Perfect Market. 27 August 2004. http://www.businessweek.com/bwdaily/dnflash/aug2004/nf20040827_0581.htm

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