Think Niche to Slay eBay

Another site billing itself as an eBay killer is launching today. Fididel offers real-time negotiation and trains negotiators that can work on behalf of sellers to help them get good prices, which makes it a potential shopping place for those disillusioned with eBay’s auction sniping. Yes, sellers and investors are unhappy with eBay at the moment, but I look at the online auction giant like I look at Wal-Mart; it’s a behemoth that might piss a lot of people off, but lots of other people still shop there.

Of course, the Internet has lots of room for other online auction or e-commerce sites, ranging from other giants such as Amazon.com to upstarts such as Etsy or last week’s launch of Wigex. As for Fididel, I think it will face the same difficulty other online auction or swap meet sites face: getting enough buyers to shop there to make it worthwhile for sellers to participate, and to a lesser extent, getting enough sellers so buyers will congregate.

The most likely path to success for these upstart online swap meets is a vertical one (think Etsy or Replacements.com). I may go onto the eBay to search out pieces of my grandmother’s Havalind china to replace cracked cups, but I’m also inclined to check out Replacements.com to double-check pricing and such. If Replacements.com (which is more of a broker than an auction site) were to branch out into a related field, such as lamps or household kitsch, I might end up checking that out too and turn to Replacements.com for all my Tiffany stained-glass needs (I don’t actually have this need, but you guys see where I’m going).

Though slow, it seem that this is how most online auctions could reasonably grow large enough to compete with eBay. Another option would be taking an existing base of buyers and adding an auction section to the site, much as Amazon.com or Overstock.com have. The path that startups like Fididel and Wigix are taking is more akin to building a shopping mall out in the middle of nowhere and hoping that buyers will take the time to search it out. It might work, but it’s less sure than building out a good niche retail store and slowly expanding your goods.


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