Another nail

Pounding another nail in the coffin of the print classified business, eBay Motors in the UK (not sure about elsewhere) is going to announce today that it will accept classified ads for cars andpric not just direct car sales, the Telegraph reports.

The move sets eBay in direct competition with companies such as Trader Media, which publishes more than 70 weekly titles focused on classified ads of vehicles for sale. . . .

Car dealers will pay £150 a month to list up to 100 cars on the site. One major UK dealer said he paid almost 10 times that to advertise on other websites and in newspapers.

Clare Gilmartin, head of eBay Motors UK said: “This is a market that needs a shake-up.”

I’d try a slightly different pricing model: a set fee for a dealer’s full inventory. Taking a limited number of listings is the way it is done in print ads because space is limited and expensive. Those are retail ads. That is, like a grocery story circular, it doesn’t tell you everything the store has but tries to lure you in with a particularly juicy price for grapefruit.

But in a search world, if you’re the sales agent or advertiser, you want everything you have for sale to be discoverable. If you’re the aggregator, you want to have everything available to be discovered. And the aggregator that makes it all available wins.

This creates an interesting economic equation, though: The sellers learn that their inventory information is of value to the aggregators — and there are still lots of aggregators competing — so the sellers or their agents stand in a position to negotiate prices down. And the next step is distributed: See Oodle or Edgeio, which scrape inventory information (jobs in the case of Oodle) wherever they are. This cuts out both the sales middleman — used car dealer, real estate broker, headhunter — and the closed aggregators — newspapers, eBay, etc. Eventually, the value resides with the buyer and seller directly — you, if you’re buying or selling a car. You’ll recognize that value by keeping more money in a sale, paying nothing or paying less to the sales agents and marketing aggregators now stuck in the middle.

  • http://robertdfeinman.com/society Robert Feinman

    One of the advantages that bricks and mortar stores had was that it was hard for customers to do price comparisons. This gives the seller an advantage. If this wasn’t so there wouldn’t be such a thing as “loss leaders”.

    Putting your whole inventory online as some do on ebay and as is happening with real estate listings gives the buyer an advantage.
    Joseph Stiglitz got a Nobel prize in economics for studying the effects of incomplete information in economic transactions.

    Full listings may also work the other way, casual sellers can also find out what things are worth and thus, there won’t be an bargains offered by the uninformed.

    Getting rid of middlemen and making the market more direct may be a good thing, but getting there may be painful for traditional companies who are brokering information.