Prior to trading websites on Flippa, for most of us our online auction experience has been via eBay. There’s been a lot of discussion and confusion around the fact that Flippa, although similar on the surface, is somewhat different to buying and selling on eBay.
The biggest difference between eBay and Filippa is that on eBay, buyers and sellers have a fair idea as to the value of the items they are trading.
Many buyers and even sellers come to Filippa asking “What the hell is this site really worth?”
On eBay, as a buyer you know what something is worth and you log on and start the bidding process with the aim of winning the auction at a price you know is going to be less than retail, or if it’s a collectible item, a price that you know is fair.
The whole trading websites market is so new that buyers and in particular new buyers have very little understanding as to what a website is worth and how to work out a buying price.
Let’s say as an example, you’re selling latex blow up dolls on eBay. Both buyer and seller have a fair understanding of the doll’s monetary value. The seller will set a start price, often a reserve with no ceiling or “buy it now” price and let buyers fight it out in the auction process.
On the other hand, no pun intended, if a seller on Flippa is listing latexrubberdolls dot com, most buyers have no idea of how to value the site and look to the seller for guidance, who in turn usually has no idea of what his site is worth.
I’m talking primarily of lower to mid range sites here, as high end sites usually attract buyers that understand the market and what a site is worth, or at least, ought to. There still is a lot of emotional attachment when buying and selling websites, which can really work to your advantage as long as you’re the one who remains unattached (to the site, not the doll).
I hear sellers often complaining all the time about potential buyers asking for the reserve price or a “buy it now” price if there isn’t one. The frustration stems from the eBay way of doing things, where potential buyers have a fair idea of what the product is worth.
On Filippa, potential buyers of low to mid range sites need to know what the seller wants for the site and then the auction “war” is about who can win at below the BIN price.
I’ve tested a number of sites in no reserve, no BIN auctions and buyers have not known what they should be paying and most of the time, the site s have sold for less than I anticipated.
The best results I’ve had have been with auctions that have a bin price and no reserve. Removing any reserve and giving the auction a ceiling price give buyers the confidence to pickup a “bargain”, as there is no reserve, but at the same time they can jump in and win the auction at the bin price if the auction gets a little too hot for them.
When trading websites, having a bin price on the lower to mid priced sites also helps deal with the frustration some buyers experience at Filippa’s policy of extending auctions if bids are placed within the last hour.
They policy allows sellers time to approve all bids and avoid any “junk” bidders ruining the auction.
You really need to understand the value of a website so that as a seller you can reap the highest price possible and conversely as a buyer you need to be able to recognize the many undervalued bargain opportunities on offer every day on Flippa.
source- http://ezinearticles.com/?Trading-Websites-and-Why-Flippa-is-Not-eBay&id=4196745
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