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Marketing's Role -- Part One

eBay Insanity

I admit it. I’m a complete eBay novice. I’ve only bid on two items up to now, but the results have me scratching my head. I wanted to get my son a set of drum practice pads because they’ll enable him to keep playing while the rest of us want some peace and quiet. These sets are often available on eBay, so I started bidding a week or so ago…

I guess the bidding pattern is pretty common: The initial price is well below the true value and doesn’t budge a whole lot till the bidding is about to close. Suddenly, within the last 10-15 minutes people go absolutely nuts and wind up paying a price that’s at or above retail value! For example, the last set I bid on was hovering around $100 until the final 15 minutes. It closed at $177.50. Guess what? I found a comparable (and new!) set on Amazon for $9 more. In fact, when you roll in the shipping charges for both, it’s a wash.

Why in the world do people pay sticker price for a used product?! I can see where it’s possible to make good money selling things on eBay, but I wonder how the buyers feel when they figure out they overpaid? Does the winner of this particular auction even realize their boneheaded move, or are they mindlessly walking around talking about the “great deal” they just got on eBay?


Michael Miller

Ah, if all of my eBay auctions closed aboved list price... For one reason or another, many categories on eBay are still a seller's market. It's capitalist marketplace economics in action, in real time. Too many buyers for too few products results in irrational prices. On the other hand, many eBay categories are now flooded with too many sellers, leaving products selling at a deflated price, if at all. Bottom line, just because it's on eBay doesn't mean it's a bargain, as you've learned. Set the amount you're willing to pay -- the amount the item is worth to you -- and don't exceed it; don't get caught up in a last-minute bidding frenzy. (Or, if you're ballsy, you'd buy a couple of sets of practice pads for list price at Amazon and then resell them for higher on eBay -- as long as the buyers remained irrational, that is!)

Jeremy Wright

Joe, it's a psychological thing. You're watching your auction, and you've put in a bid of say 150$ as your max, because you know you could get it for like 170$ or 200$.

But then someone bids 155$. You get mad. It was SO CLOSE to being yours, so you up it to 160$. Someone else gets mad and goes to 165$. Then someone new comes along and sees they can have it for 170$ with only minutes left in the auction.

Boom, an item that shouldn't have sold for more than 150-155$ is selling at near-retail value.

It's fairly common. There's also 'sniping', which is something else entirely (where people use programs to auto-bid for items that are well below retail value).

All of that said, keep your eye on the drums area. It's not normally priced anywhere near retail. I know, I've bought lots of cymbals, stands, snare drums, sticks, etc, for well below even clearance price. Sometimes it takes 2-3 auctions, but there are lots and lots of sellers, and only a finite number of buyers looking for specific things.

Joe Wikert

I'm not crazy (or wealthy!) enough to start speculating on the eBay market. It would be just my luck to buy a couple of things with the hopes of turning a profit by flipping them on eBay, only to find that the demand has dried up!

Jeremy, thanks for the tip. We've generally bought all our drum-related items locally at a brick-and-mortar store or online from the shop I used to frequent as a kid growing up in Pittsburgh, PA: DrumWorld (see

Mike Ziemski

Ebay - It's amazing what you find on the Internet - even people! Had to buy my son a set of drums on Ebay - carrying on the band tradition since he's on his high school's drum line! Every one of my 14 transactions I've completed on Ebay have been good experiences. My latest lament is that there are no good "bass" havens in Western PA. Drop a line if you get a chance!!

Joe Wikert

Mike Z., it's great to hear from you! Glad to hear that your offspring is smart enough to go the percussion route rather than the guitar one.

Jim Minatel

I'd agree that Mike M is right about the category-by-category nature of the beast. I've sold some shrinkwrapped software I didn't need and at least in the catagories I've sold in, the buyers seem to cap their bids at around 80-90% of fair retail. I've also sold used PC hardware parts for just a few dollars less than someone would have paid for something similar but newer and faster.
And I've sold a used hot-tub (aren't you glad to see that beast gone from my back yard) in a case where the free market really worked: I was happy to be rid of it at any price and the buyer saved enough versus retail to load up on a few extra gold chains to enhance the Austin Powers hottub experience.

Joe Wikert

Jim, I'm betting that the hot-tub price was the lowest one of all, relative to a list price...not because of the Austin Powers factor, or the fact that it's a tub (eeewwww!), but because of transportation logistics. You probably didn't box that one up and send it out FedEx, right? Because of the size, that offer was more like a local garage sale opportunity than the others. IOW, you were probably only catering to locals, which limited the number of bidders, which probably also kept the price down, no?


It's like anything else, you need to be educated about what you're buying and where you're buying it from.

So here are a few of my novice tips for buying on eBay:
1. Search don't browse. Use the search function instead of browsing categories. See #2 for why.
2. Search all of eBay, not just specific categories. A lot of sellers often don't put their products in the correct category so you might not even see them if you're searching just a specific category.
3. Be sure to look at all of the pages returned in your search for cheap Buy-It-Now prices! It's easy to just look at the first page and neglect the others.
4. Know the retail (new) and used FMV of whatever your buying. As you found out, auctions will sometimes end up going for far more than the retail value. That's nuts!
5. Know how much you want to pay and stop there. It might take you several auctions, but it's worth it.
6. Don't get caught up in the hype. As Jeremy points out, it's easy to get emotional about wanting to win the auction. Don't do it.

I now buy all of my CDs, DVDs and Xbox games through eBay. Most are used, but sometimes I'll catch a good deal on new ones still in the shrink wrap. It's amazing how I'll search all of eBay for an Xbox game and the first handful of auctions (ending the soonest) will be just a few dollars under current retail due to bidding wars. Then I look through the next few pages of my search and I'll often find a Buy-It-Now offer that is at or under the used FMV.

Hope that helps and best of luck!


I've not visited ebay for a while .. since unfortunately I am in Singapore and sometimes shipment cost makes it not worthwhile to do so ..

Anyway .. just note that if an item seemed way too cheap .. be wary .. can be fishy .. so better check up the seller and if possible contact the seller thru phone to verify the authenticity and accuracy ..

Next .. NEVER .. NEVER .. NEVER .. pay by Western Union! I was conned USD1000 by some Romanian fella ..

Apparent there was some phishing going on back then and identities were stolen .. the guy offered me an off the system deal that was all too tempting .. so just be wary


Could Not Have Said That Better Myself!!!

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