Christian Braun, formally of Auctioning4u, has started a new online platform aimed specifically at toy collectors. I caught up with Christian to talk about his new venture, toycollector.com.
What is your experience in online marketplaces?
In April 2003 I founded Auctioning4u which sold unwanted possessions or overstock on online marketplaces, pre-dominantly eBay. We have sold approximately 130,000 items. We constantly looked at other sites and sold on quite a number of them and were shocked at how dominant eBay was. Back when I worked at General Electric Jack Welch, its then CEO, was famous for stating as a goal to be No.1 or No.2 in your industry or get out. On the Internet you want to me No.1 or get out. The last time looked statistics from Hitwise show that eBay has close to a 99% market share in online auctioning!
So why do you want to go into online auctioning?
Martingale’s Team believes that the hegemony eBay has enjoyed in recent years is giving way to web 2.0 specialist sites with strong community and commerce elements. Etsy is a good example. A marketplace for knitwear and other handicrafts I understand they now have about 1.5 million members including 200,000 active sellers. Etsy has gone for a market that eBay does not serve well. eBay’s listing fees (as opposed to its final value fees) make it quite hard for sellers of handicraft items to sell on the site. Handicraft items are difficult to find through search (no key words) and need some ambiance that eBay’s cold listing format just does not provide.
Where are you with your online marketplaces?
We have started our new company Martingale Internet Technologies in February 2008 and have launched our first community in Beta mode in June. It’s called Toy Collector (www.ToyCollector) and serves the vintage and collectible toy community. We have just com e out of Beta this month with a relaunch that has significant new functionality.
The vintage and collectible toy market worldwide is surprisingly large at £2.5 billion. It is also growing by a healthy 10% a year . There are 2-3 million core collectors out there that transact once a week and spend up to three hours a day on their hobby. Furthermore, toy collectors are highly networked, if you do something good for them they will spread the message.
With eBay having 99% of the market and huge resources, surely the task you face is somewhere between difficult and impossible. Do you really think you can over take eBay in toys and become no.1?
We do, for several reasons. First of all, we believe that the online selling landscape is changing in a number of ways. eBay have made clear their intention to move focus away from a predominantly auction-based model to a more Amazon-like Buy-It-Now setup. While it’s widely known that similar items listed in similar ways in auction format on eBay will achieve similar prices, and that as such it should be simple for sellers to set Buy-It-Now prices, this removes much of the fun from the whole process. Many users have complained that eBay’ previous system changes, such as hiding the names of the bidders in the name of safety have already lessened the user experience. More crucially, however, a Buy-It-Now listing may run for months with no buyers, while an auction-style listing has a shorter turnover time. As such (subject, of course, to the use of other features like reserve pricing), an auction-style listing virtually guarantees a sale at its end and a more-rapid turnover for the seller.
Furthermore, in its attempts to encourage users to move to a Buy-It-Now format, eBay has recently raised fees considerably for auction items. This has caused disenchantment among sellers, as have the changes to the feedback system, whereby sellers can now no longer leave negative feedback for buyers, but buyers can still leave negatives for sellers. This, coupled with the long-known issue in the collecting lobby of eBay allowing faked models to be listed and seemingly paying scant attention to reports of these, has seen a huge rise in the number of forum posts on the net where eBay sellers are seeking alternative sites.
With the rise of web 2.0 and the movement of content from the centre to the edges of the net, specialised user-generated content and platforms are fast becoming the norm. What we aim to offer is a combination wiki-based information, social networking and selling platform which will specifically serve communities like toy collectors, be tailored to their needs, and allow them to tailor the site to serve their own needs, with customizable content, information channels, etc.
We recognise, however, that critical mass and community awareness are key to achieving this, and this is why we haven’t started out by launching a selling platform right off the bat. Rather, we intend to introduce the social networking and wiki-based reference elements first. In this way, we hope collectors will see the site as a useful tool and the introduction of the selling platform will be a logical extension of this. Unlike eBay, it will be possible for users to get a lot out of our site in terms of gaining information, meeting others and enjoying toy-related interaction without ever buying or selling anything in the marketplace. As such, we believe toy collectors will come to the site for all the above reasons and sellers will use the eventual selling platform because they feel it better caters to their needs.
As for eBay’s reach beyond the collector market, we have designed the site in such a way as to make it as easy as possible for the layperson who, say, has inherited a collection of toys but knows nothing about them, to use our wiki-based reference guide to value their items and easily list them in the market place with features that virtually generate the keywords in the listing titles for you. Our vast wealth of on-site reference material and the keywords in out constantly-changing user-generated content will ensure that we always do well in search engine results and are easily findable by anyone researching antique toys - indeed, a good proportion of our early users found us in this way and have stated similar stories to the above in their reasons for joining. And once they find us, we believe the ease-of-use of the site and the promise of an automatic audience to buy what they have to sell will persuade them to use us to sell.
So how is it going?
So far so good. We are currently growing our content by 50%+ per month. We are now receiving a lot of support from toy companies, such as Corgi, Herpa or Schuco (all in the Top 20 toy companies).
What will come after Toys?
We have plans for a number of collectibe areas such as sporting memorabilia, comics and coins . Martingale estimates that its addressable markets have a volume of around £120 billion.