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EBay Bids for a Piece of the Photo Retail Market

Before there were list prices—or, for that matter, price lists—there were auctions. Check our species' evolutionary scale—I'll bet we could bid before we could write. You need to be literate to make price lists, but you need only to raise a hand to enter an auction. And auctions are up-to-the-minute. List prices reflect values at the time of the listing. Auction prices reflect values now, in this economic climate, today's supply and demand. There's less certainty in an auction—you can't forecast your margins—but there is a lot of action. So people love auctions, partly as commerce, partly as sport.
The result is that there are all kinds of auctions, all over the map. Uptown, in clipped tones, the auctioneer insists, "come, come now, surely five." Out in Jersey, at the top of his lungs, another demands, "you don't have five bucks, are you sleeping out there?" Drive down to Pennsylvania—plenty of tools for that five-dollar bid, and old toys too. Go to a tax lien auction with studied indifference. Go to a USPS auction, and watch people argue over cartons of cologne. In some auctions the bidders shout, in others they raise paddles. How many other variations could there be?
Well, in yet other types of auction, they send a message. The proxy bid, sealed bids, phone-ins—they're all tools of the trade. Not sure exactly how much you should set for a minimum bid? Enter a reserve bid. If the top bidder doesn't reach the reserve, maybe he's close enough? Does someone want to make a deal?
An advantage of mail-in bids is that they expand the market. Without them, your prospects are limited to how many bodies could get into the room. Too bad if it rained that day. With the mail, bids can come rain or shine from anywhere on the planet-or at least from as far away as the auction catalog was sent.

Mail Bids in the Email Age
In our newly wired world, of course, the catalog goes nowhere. It sits as computer code on a server someplace, and readers log-on. If you're on a desert campaign or a great oceanographic mission, caught in a shooting war or—what the heck—tossing back a pina colada at Club Med, no matter what you're doing, you can get your e-bid in.
On-line auctions were an obvious potential of the Internet, and they were quick to take hold. Lots of auction sites popped up. There was, er... Well, there was eBay for sure. Sure there were others too. But as Kleenex is to the paper hanky—the coined, registered, proprietary trademark that is used as a generic—eBay is to the on-line auction. Everyone understands what you mean when you say, "I'm putting it on eBay," even if your auction's on, you know, whatchamacallit, yahoo.
EBay creates a marketplace that's just a little different than before. For starters, not all the bidders get the same catalog. Depends on their searchwords. But also, national boundaries tend to be altered somewhat, or eradicated, and time zones become irrelevant. Language barriers? Well, if English isn't the language of global commerce, maybe someone makes a good translation program?

Build It After They Come
It must have dawned on eBay one day, that they were generating a lot of traffic. Sure, all those people were there for auctions. But as long as they're there, do you think they might be interested in other kinds of deals? Beginning a year or two back, eBay introduced programs to bring more straight commerce into their tent. The "buy it now" feature, for example, enables the auction-goer to skip all the bidding, and give in to an impulse to buy at a predetermined price set by the seller. In theory this is a premium price, which the buyer is willing to pay for instant gratification, or for assurance of winning the item. But there is no regulation stating that the "buy it now" price has to be higher than the opening bid. If they're exactly the same, then the auction's no longer an auction. It's a classified ad placed before a large market that used a searchword to find it.
About the same time they were concocting these schemes, eBay was moving into photography turf. They were a surprising exhibitor to find at the PhotoPlus show in 2000. Since then they've shown-up at a couple Digital Focus media events for the photography-conscious, during PC Expo and the PMA show. They say they'll be at PhotoPlus again this autumn.

Setting the Buzz
"In 2001, eBay's photography sales reached $190 million," states their recent press release, and "every hour, more than 55 digital cameras are sold on eBay." Gosh, that's almost one every five minutes. Is that 24/7? Okay, that sounds like a lively business.
"Besides the immediate sales," said Lori Yuhas, eBay's Photo category manager, describing her pitch to the photo trade, "we like to discuss customer acquisition. Once you've done business with that customer on eBay, you own him, we tell photo retailers." Obviously the customer does e-mail, obviously he buys things, and he's in your database. When's your next mailing?
Some of our most treasured notions take a licking, in the light of cold eBay stats. What becomes of the element of service, for example, personal service like the customers crave, where a wise and patient demonstrator helps each choose the very best camera? You theoretically don't get that in an eBay sale. "The customers get a great deal," said Ms. Yuhas, "and we think that in exchange, they're willing to seek their counseling elsewhere." By reading the magazines, maybe? Or visiting a bricks and mortar store that has sales associates hovering, waiting to do good?
If eBay's methods prevail, both the media and the sales force become all the more an extension of marketing and PR. To demonstrate the point, they initiated their own on-line photo magazine under their Photography Resource Center, starring Rick Sammon, America's most popular photo expert.

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