October 31, 2000 4:10 PM PST
eBay tacking on buyer's fee to upscale auctions
The San Jose, Calif., online auction giant is adding a buyer's premium to auctions in its upscale Great Collections area. The fee, which will be 10 percent of the closing auction price, will be paid by bidders to eBay Great Collections sellers starting this week.
"By introducing a new fee structure, we expect to attract more qualified sellers who might not have listed their finest works of arts on the Great Collections site previously due to economics reasons," eBay said in a note to members on its announcements board. "This change will make Great Collections a more vibrant online marketplace and improve your buying experience with a greater number of high-end fine art, antiques and other unique collectibles."
eBay did not return repeated calls seeking comment.
The move represents the first time eBay has imposed a buyer's premium on a whole class of auctions on its site. Rival Sotheby's has charged a comparable fee to buyers on its Sothebys.com and Sothebys.Amazon.com sites since they launched, and some saw this as a move to compete more directly with the traditional auction house.
"This is a significant step for eBay," said Mark Gambale, an online auction analyst for Gomez. "They're trying to appeal to the offline or other sellers. This is a good way to bring them in. eBay's now a more serious contender in the fine collections space."
The buyer's premium will be included in the final price that bidders pay. Unlike on Sotheby's auction sites, where the fee goes to Sotheby's, eBay buyers will pay the fee directly to sellers.
This is not the first time a buyer's premium has appeared on eBay. In July, Robert Edward Auctions added a 15 percent buyer's premium to its auction of the Honus Wagner baseball card. The card sold for $1.27 million, including the additional fee.
Despite eBay's hopes that the new fee will draw more sellers and more upscale items, Sothebys.com president Craig Moffett said he does not expect the new buyer's premium to have much effect.
Dealers of high-end property will continue to offer their goods where they will get the best price, Moffett said. Likewise, bidders on such items will go where they can find the best selection.
"eBay's struggle has been that they don't have access to the same pools of property that we do," Moffett said. Although eBay was expected to make a big push into upscale auctions with its purchase of old-line auction house Butterfields last year, Moffett said that threat has not materialized.
"As a presence in the marketplace, we feel them a whole lot less than we did six months ago," he said.
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