Quote:
Originally Posted by wj2009 
while in theory the pay-for-bump may end up cheaper than 5% drop, sellers may not feel that way. It is cheaper only if you get to sell something, not if you cannot sell it. People loath paying upfront even if it may be cheaper at the end. eBay hires tons of people to study the behaviors of sellers and buyers and it chose to basically waive listing fees in exchange for higher final fees. Think about it, sellers often end up paying more this way. But guess what, listing volume is up. Why do you think wireless carriers give you free phones? The lure of free entry upfront cannot be overestimated.
I am not comparing SF to eBay. I am only trying to make a point: people don't think or act in the "optimal" way Fok wants them to.

while in theory the pay-for-bump may end up cheaper than 5% drop, sellers may not feel that way. It is cheaper only if you get to sell something, not if you cannot sell it. People loath paying upfront even if it may be cheaper at the end. eBay hires tons of people to study the behaviors of sellers and buyers and it chose to basically waive listing fees in exchange for higher final fees. Think about it, sellers often end up paying more this way. But guess what, listing volume is up. Why do you think wireless carriers give you free phones? The lure of free entry upfront cannot be overestimated.
I am not comparing SF to eBay. I am only trying to make a point: people don't think or act in the "optimal" way Fok wants them to.
You are absolutely correct. I am actually one of those people who study those behaviors (though not for Ebay). Essentially, Ebay wants to lower the barriers to listing. We have done that too. There is absolutely no cost associated with listing. Essentially, the only charge is if you decide that you want more visibility for your item. Ebay does the same thing. The one big, big, difference here is that Ebay makes you pay for this upfront (featured listings, etc..) On this system, you can do it at whatever time you choose, or not.
Finally, we charge no final value fees, for 2 reasons. 1) The revenue stream of an Ebay is radically different from that of Styleforum, and 2) We neither have the technical nor legal apparatus to deal with final value fees. Right now, fees are essentially for additional advertising of your listings. Taking a commission on a sale puts you into a whole other legal ballgame re. liability, something we are not going to do, nor do we intend to do,
On a completely tangential point, people do not "act optimally". If I had my way, I would sell my used socks for $1000 a sock. If Spoo had his way, he'd buy my Patek for $10. However, no one is going to buy my sock, and someone is going to pick up that Patek well before I have to drop it to $10. It's the market that drives people towards behavior that is optimal for that market.













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