Flea market on the World Wide Web

What do an invitation to tea with Nelson Mandela have in common with the brush Tom Sawyer used to paint fences, Pope Benedict XVI's former car and a World War II submarine? All this was put up for auction on eBay this year. Over the past few years, eBay and similar online services have gradually begun to penetrate into Russia, which is primarily due to the spread of plastic bank cards and non-cash payment systems. All this opened up enormous prospects for collectors and simply those who like to bargain for a cheap purchase, and also raised even more questions. How does an online auction differ from an online store? How reliable is it? What is required to participate in the auction?

To understand how an online auction works, just imagine a flea market in any European country. Only instead of a small street in Paris or Rome, where at best a few hundred people can fit, an online flea market can fit several million users, or even more. At the same time, trading takes place 24 hours a day, and the seller and buyer can easily be on different continents. The seller places the lot in the online auction service, indicates the starting price (if desired, you can also set a blitz price) and the auction period. Then the buyers begin a fight to raise the bid, the winner of which contacts the seller and discusses a specific method of transferring money and delivering the goods.

With some exceptions, which will be discussed below, the range of lots at online auctions is limited by the imagination of tens of millions of service users. That is, in fact, it is not limited at all. They sell everything - from real estate to air (from the stadiums of the last World Cup), although the vast majority of lots are quite ordinary things that can be easily found without resorting to auction services. However, the daily volume of Internet auction transactions, including small sites, approaches tens of millions. Only on the most popular online auction, Ebay, up to half a million transactions are made every day with more than twenty-five million lots on display.

According to legend, the first and most famous Internet auction eBay was created by American programmer Pierre Omidyar after his fiancee complained about the inability to replenish her collection of PEZ lollipop boxes. Unfortunately, this beautiful story was invented to attract the press in 1997, although the reality is not much inferior to the fiction. eBay (then Auctionweb) did appear on September 4, 1995, as part of Omidyar's personal website, but his fiancee did not have any collection. And the first thing sold at an online auction was a broken laser pointer from the creator of the service, which was sold for almost $14. To Omidyar’s surprised question, “Why do you need this?”, the buyer simply replied, “I collect broken laser pointers.”

The entire subsequent history of eBay is a confident road to success, which does not make much sense to describe. Having happily survived the collapse of the dot-com market at the end of the last century, Omidyar’s company gradually improved the available services, absorbed regional competitors and clarified the rules for using the service. But the basic principles of the service have remained unchanged since the mid-90s. With minor differences, they also apply to other major Internet auctions: Amazon.com Marketplace and Yahoo! Auctions . More specialized services, such as those dedicated to antiques or used cars, may impose additional conditions for bidders.

As already mentioned, the sites themselves are just a platform for meetings between interested users. At the same time, the administration of the Internet auction acts as a technical intermediary, and not as a guarantor of a fair transaction. In traditional auction houses, the lot undergoes an examination before trading, but in online services there is no such procedure. This would violate the basic principle of the functioning of Internet auctions - maximum proximity between the seller and the buyer, where the site is used as a tool for their interaction. This “technical” role of online auction services is easy to notice if you look at the structure of their income. The lion's share of the profit comes from a small listing fee ($0.20-$80 on eBay) and commission fees (3-5% on eBay) charged to the seller on each transaction.

Of course, there are certain rules for placing lots. Most online auctions prohibit the sale of tobacco products and alcohol (except for specially designated collectible varieties), “pirated” records and objects that violate registered trademarks, human organs, firearms and Nazi paraphernalia. But control services are not able to monitor whether the product corresponds to the stated description, whether it is defective or counterfeit, since they have the same amount of information as an ordinary user. The same Omidyar found an original way out of this situation for eBay - they have a system adapted to specific conditions, combining a “book of complaints and suggestions” and a “credit history”

After the auction is completed, both the seller and the buyer can leave their brief comments about the transaction: whether the goods were delivered on time and payment was made, whether the lot corresponded to the stated description. Based on typical reviews, a user rating is compiled - the more positive comments, the higher the rating. With a rating of 20 or higher, you are already considered a “verified client,” which provides certain advantages in auction services. But more importantly, reading reviews is available to any registered user, but editing them is almost impossible. To do this, you need to contact the auction administration, explain the reason for such accusations against you and prove their illegality. This is incredibly difficult to do, so all that remains is to “preserve honor from a young age.” The greatest controversy in such a system is caused by equalizing the importance of various transactions for the rating. In the “book of complaints,” comments after selling your daughter’s old shoes for $10 and a collectible Volkswagen Beetle for $500,000 can be absolutely identical and play the same role in the formation of the rating.

The largest domestic Internet auction Molotok was opened in 1999 by Mail.ru. In essence, it was a repetition of the main functions of eBay, taking into account the domestic flavor. For example, not only registration is free, but also placing a lot at auction, and paid services include completely optional “auction advertising” and recording of viewing statistics. Of course, in terms of the number of lots, Molotok is still very far from eBay, but the Russian “registration” of the service also has its advantages, first of all, the likely absence of problems with delivery. After all, even if the buyer has the money to deliver goods from Europe or America, some sellers do not agree to do business with Russia, finding it too risky. However, this attitude is gradually disappearing, and in the descriptions of lots, the column “Delivery: international” is most often found, meaning the seller’s readiness to send your purchase to the point in the world where you ask.

Today, the level of Hammer is still seriously behind its foreign competitors. And it’s not just the number of lots on display, but also their range. Almost half of the current lots are collectible stamps, coins, postcards and similar items. Such a “collectible” orientation was characteristic of eBay in the late 90s, when Internet auctions were not yet considered as a platform for serious transactions. Today, on the same eBay, IBM Corporation buys promising technologies that small companies put up for auction. And on Molotok, the most popular service put up for auction is (I quote verbatim) “receiving a free tariff for unlimited use of mobile communications.” However, the service is developing and may be of interest at least to get acquainted with the capabilities of Internet auctions.

There are also so-called intermediary sites, for example http://www.pregrad.net/ . They are not full-fledged online auctions, but serve to serve users who cannot do business directly with foreign services. The most common reason is difficulties with payment and delivery of goods. Although it is no longer difficult to acquire a MasterCard card, some sellers ask to pay for items using Paypal (the American equivalent of Webmoney or Yandex-Money) or American Express checks. Also, intermediaries can take on customs clearance of the won lot, and even communication with the seller - for a fee, of course. However, with the simplification and development of non-cash payment systems for individuals, the development of the intermediary business is in question, although such companies will certainly have “their” clients.

It is pointless to give any general advice on participating in auctions - only you can decide what and for what money you will purchase. The main thing is not to forget that you are on a virtual analogue of a flea market and use all available means of verification. The inability to look the seller in the eye and touch the product is compensated by the opportunity to find out reviews from past buyers and study other lots of the seller. Can save you a lot of money on other, more reliable trades. Because the excitement at virtual auctions is no different from Christie's. Only here you can find that same laser pointer that is so missing from your collection.