When eBay started in1995, were you one of the people who was endlessly fascinated by (addicted to?) this new way to buy or sell anything in a worldwide market? I certainly was.
I became a collector of...things: Saturday Evening Post magazines with Normal Rockwell covers, Playboy magazines from the Fifties and Sixties (for the articles, or course), and assorted other items. Purchases were expensive because the service was new and supply/demand equilibrium hadn't occurred yet. As more buyers and sellers entered, the prices of many items dropped through the floor. I stopped collecting because the things I had already acquired became worth virtually nothing, so I was afraid to bid unless I really needed something, like a particular book or DVD.
On the other side of the transaction are all the sellers who started businesses selling collectibles that rapidly depreciated as demand slid. Some of them used to sell through franchised drop-off stores that sprang up, and then went out of business pretty fast. Yet, according to eBay officials, an average of 250,000 small businesses have been selling on the eBay platform over the past five years. The company would not tell me how that number has trended during that time (if you have a source of that data, please let me know).
To be sure, eBay offers some excellent advantages as a business platform for entrepreneurs and small businesses. Dinesh Lathi, eBay's VP of Buyer and Seller Experience, explained the three core advantages of eBay: It's fast, easy and cheap compared with setting up your own online store; setting up a payment account with sister company PayPal is simpler than opening a credit-card merchant account; and you have instant global reach to 90 million active users. EBay does $2000 in transactions every second, so there's a decent chance someone wants to buy what you're selling. (Like the pair of rarely used Rollerblades and the Sharper Image massager that I got out of my closet and banked $150 for, thank you very much!). As Lathi says, "In the time it takes you to have lunch, you can be up and selling with eBay as a small business."
Also bolstering the eBay small business market is the increasing number of mobile applications. The eBay iPhone app has been downloaded more than 9 million times, Lathi says, and it's installed on 30 percent of iPads. The company expects $1.5 billion in transactions to be completed on mobile devices in 2010. Social networking is also helping fuel eBay sellers' businesses.
Which brings me to my question:
Are you an eBay small business/entrepreneur? Please comment on your experience with eBay, how your business is faring, and what you think the future holds.