Did Trademe get too greedy?

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#1051185 22-May-2014 16:13

greenbone: i think trademe does have reason for concern, not from wheedle ... from facebook

the BST groups on facebook have exploded in the last 6 months. the largest, hustle live, has over 70k members. dozens of items listed every hour. and hustle is one of many

imo trademe has greatly underestimated social integration. tagging friends on items you think they might like for example

plus of course the benefits of no fees and no restrictions on the items listed has helped made fb groups popular

I agree.

My wife used a local Facebook site to sell off all our unwanted stuff when we sold our house in Canada last year.

Despite the fact there's a large free listing site (kijiji.ca, Canada's equivalent to Craigslist) in that city.

Distorter

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#1051198 22-May-2014 16:26

Yes Trademe are too greedy. Listing a car was initially $19.95 if I recall correctly now it is $39, did it really need to DOUBLE in price, come on.

Plus success fees are a rip. Gave up on trade me when I sold something for $220 and got charged nearly $20 for it :-( that was back in 2012 probably even worse now!

Now days just sell things on BST forums and our staff intranet.

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#1051204 22-May-2014 16:33

Distorter: Yes Trademe are too greedy. Listing a car was initially $19.95 if I recall correctly now it is $39, did it really need to DOUBLE in price, come on.

Plus success fees are a rip. Gave up on trade me when I sold something for $220 and got charged nearly $20 for it :-( that was back in 2012 probably even worse now!

Now days just sell things on BST forums and our staff intranet.

But would you have sold it more elsewhere minus the commission. This is the argument real estate agents use, that they can get a better price less the commission, than you can get if you sell it privately.

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#1051217 22-May-2014 16:58

Dynamic:
mattwnz: Trademes biggest threat apart from social media sites, is ebay, as if they enter the market, I expect them to be pretty ruthless in their marketing and pricing and eBay is a top global brand.

EBay came to NZ and failed miserably years ago.

And they'll never try again. Ebay are smart enough to know it's a winner takes all market.

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#1051221 22-May-2014 17:13

ajobbins:
Dynamic:
mattwnz: Trademes biggest threat apart from social media sites, is ebay, as if they enter the market, I expect them to be pretty ruthless in their marketing and pricing and eBay is a top global brand.

EBay came to NZ and failed miserably years ago.

And they'll never try again. Ebay are smart enough to know it's a winner takes all market.

They did sort of come to NZ, but wasn't that just an add on to the australian market, and the website was crap. I think it was all bit half hearted. I think it is a 'winner takes' all market to a certain extent, until users habits change, such as what is happening with facebook. And at some stage fees will rise to an extent where people will shift to other options. The problem is that a company like that needs to continually raise their revenue for shareholders, as the company needs to be growing. But where can they really take trademe to grow revenue, apart from raising fees, which has a limit. I haven't seen much to raise it value of late, as it is still the same old website, with the same limited tiny images, and no video options. They have purchased quite a few different online businesses, and maybe they are intending on growing those in the future instead, but I don't see it as a growth company these days.

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#1051225 22-May-2014 17:26

I just use facebook now to sell everything

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#1051229 22-May-2014 17:33

shrub: I just use facebook now to sell everything

I'm using Facebook less and less now anyway, as are many others I know. It might be too late for them anyway

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mattwnz

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#1051268 22-May-2014 18:54

It would be interesting to know what level of fees would be considered too high. Trademes fees are still quite a bit less than they charge at physical auction houses, where there is usually at least a 15% commision deducted fromt he sale price, and the buyer also needs to pay a 15% buyers premium on top of the sale price.

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#1051271 22-May-2014 19:06

ajobbins: The reality is that even with the new pricing model, Trade Me is still incredibly cheap for agents compared to legacy forms of advertising like newspapers.

Agents had it good for a long time, paying as low as $1 per listing at one point in the past. And as always, they were billing their clients for the service, and usually at much more than their own cost.

$159 is NOTHING in the advertising budget, especially for the exposure Trade Me gets it - especially when you can pass the cost onto the vendor.

What would $159 get you in a newspaper? Probably not even a 4x3 ad in the local paper for 1 day.

That's a pretty sad view. TradeMe does not spend $159 on the costs of hosting your property listing - probably $5 at most for a very popular and long lasting listing. TradeMe is New Media, and of course they will beat Old Media in pricing - but that doesn't justify gigantic profit margins. They can jack their prices simply because they have no worthwhile competition. So yes, they did get greedy.

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#1051307 22-May-2014 19:46

ripdog:
ajobbins: The reality is that even with the new pricing model, Trade Me is still incredibly cheap for agents compared to legacy forms of advertising like newspapers.

Agents had it good for a long time, paying as low as $1 per listing at one point in the past. And as always, they were billing their clients for the service, and usually at much more than their own cost.

$159 is NOTHING in the advertising budget, especially for the exposure Trade Me gets it - especially when you can pass the cost onto the vendor.

What would $159 get you in a newspaper? Probably not even a 4x3 ad in the local paper for 1 day.

That's a pretty sad view. TradeMe does not spend $159 on the costs of hosting your property listing - probably $5 at most for a very popular and long lasting listing. TradeMe is New Media, and of course they will beat Old Media in pricing - but that doesn't justify gigantic profit margins. They can jack their prices simply because they have no worthwhile competition. So yes, they did get greedy.

What evidence do you have that it only costs them around $5? They have staff to pay, overheads, shareholder dividends etc., which is all factored in. Property listing can be renewed forever until the property sells. Some people have their properties listed on there for years, so the cost vs benfit is probably the best bag for your buck when selling. Agents are getting a substantial discount over what private sellers have to pay, which is nearly $400. I didn't actually realise that they charged $50 more if you are listing a property with an RV over$450,000, which seems odd. I wonder if they will be doing more of that sort of thing int the future.

ripdog

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#1051311 22-May-2014 19:49

mattwnz:
ripdog:
ajobbins: The reality is that even with the new pricing model, Trade Me is still incredibly cheap for agents compared to legacy forms of advertising like newspapers.

Agents had it good for a long time, paying as low as $1 per listing at one point in the past. And as always, they were billing their clients for the service, and usually at much more than their own cost.

$159 is NOTHING in the advertising budget, especially for the exposure Trade Me gets it - especially when you can pass the cost onto the vendor.

What would $159 get you in a newspaper? Probably not even a 4x3 ad in the local paper for 1 day.

That's a pretty sad view. TradeMe does not spend $159 on the costs of hosting your property listing - probably $5 at most for a very popular and long lasting listing. TradeMe is New Media, and of course they will beat Old Media in pricing - but that doesn't justify gigantic profit margins. They can jack their prices simply because they have no worthwhile competition. So yes, they did get greedy.

What evidence do you have that it only costs them around $5? They have staff to pay, overheads, shareholder dividends etc., which is all factored in. Property listing can be renewed forever until the property sells. Some people have their properties listed on there for years, so the cost vs benfit is probably the best bag for your buck when selling. Agents are getting a substantial discount over what private sellers have to pay, which is nearly $400. I didn't actually realise that they charged $50 more if you are listing a property with an RV over$450,000, which seems odd. I wonder if they will be doing more of that sort of thing int the future.

Sorry, I was only talking about marginal costs. Obviously there are significant fixed costs, but really, nowhere near enough to justify a price hike of this size. This is simply a near monopoly flexing it's muscles.

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#1051332 22-May-2014 20:08

The relationship between Trade Me's cost and the price they charge is irrelevant.

Even at $159 I think it represents insanely good value versus alternatives. As always, if you don't like it, don't use them. No one has a gun to your head.

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mattwnz

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#1051334 22-May-2014 20:11

ripdog:

Sorry, I was only talking about marginal costs. Obviously there are significant fixed costs, but really, nowhere near enough to justify a price hike of this size. This is simply a near monopoly flexing it's muscles.

Yes, but no business will sell at the pure cost price of the data used and storage on the drive, as all businesses need to pay expenses, and make a margin on top of that. Those that do, will fail at some stage, or will be getting income from somewhere else to subsidise it. eg Facebook gets it's income from advertising and data collection from peoples usage.

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#1051357 22-May-2014 20:33

Where does this $159 come from? It looks much higher to me:

http://www.trademe.co.nz/help/18/fees-and-fee-calculator#property

Ah, different prices for agents.

http://agents.trademe.co.nz/listing-fees/

Gosh I don't see what the fuss is about.

As for http://www.realestate.co.nz/ it hurts my head and I would not want to use it. Even Wheedle is better.

Anyway good luck to them but I can't see buyers moving away from TradeMe anytime soon and I can't see renz being smart enough to make it happen.

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#1051373 22-May-2014 21:03

ajobbins:
shrub: I just use facebook now to sell everything

I'm using Facebook less and less now anyway, as are many others I know. It might be too late for them anyway

There's still millions of trademe-like-bored-people-sitting-at-home on facebook. And many of them not being able to afford the fees trademe, ebay etc...
That's where the facebook BST, Gumtree type sites come into it.
My Mrs goes through her wardrobe every few months and sells more on farcebook than she ever did on ebay.

and then buys more

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