The Homa Files

TakeAways: (1) When you give buyers a chance to bid low on your product, they will.  (2) If your  product sucks, they’ll bid low … real low.

Welcome to the era of Government Motors.

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Excerpted from WSJ, “GM, eBay End Online Sales Effort” By Geoffrey Fowler, Scott Morrison, and Sharon Terlep, September 30, 2009

General Motors is ending a seven-week experiment to sell new cars in California with eBay as many dealers report the online marketplace didn’t help sell more vehicles and led shoppers to offer low-ball prices … but the program did generate customer interest … and customer leads …

The program launched … as part of an effort to make car shopping more convenient …

The experience illustrates why car retailing, which involves peculiarities such as franchised dealers with exclusive territories and the tradition of haggling in person, makes an odd fit for the Web, where consumers expect to comparison shop for the lowest price …

The promotion didn’t allow customers to bid against each other, like they do in typical eBay auctions. Rather, they could click “Buy It Now” to purchase a car at a preset price, or send an offer to a dealer … the ridiculously low offers forced staff to sift through bids that were highly unlikely to result in sales …

Maybe GM and eBay should have done more to set appropriate expectations among shoppers, many of whom had no idea where to start their price negotiations.

Edit by TJS

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Full Article
http://online.wsj.com/article/SB125423429407549391.html#mod=todays_us_marketplace

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This entry was posted on October 22, 2009 at 7:22 am and is filed under Autos - Travel, Internet Marketing - eCommerce -. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.