Trade Me

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Trade Me
Trade Me logo
Trade Me main page
Trade Me page as of October 2012
TypePublic
Traded asNZX: TME
HeadquartersWellington (main office), Auckland, and Christchurch, New Zealand
Founder(s)Sam Morgan
Employees190
Slogan(s)Where Kiwis Buy and Sell
Websitehttp://www.trademe.co.nz
Alexa rank1,699
Launched1999
 
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Trade Me
Trade Me logo
Trade Me main page
Trade Me page as of October 2012
TypePublic
Traded asNZX: TME
HeadquartersWellington (main office), Auckland, and Christchurch, New Zealand
Founder(s)Sam Morgan
Employees190
Slogan(s)Where Kiwis Buy and Sell
Websitehttp://www.trademe.co.nz
Alexa rank1,699
Launched1999

Trade Me is the largest Internet-auction website operating in New Zealand. Managed by Trade Me Ltd., the site was founded in 1999 by New Zealand entrepreneur Sam Morgan, who sold it to Fairfax in 2006 for NZ$700 million.[1] Trade Me was publicly listed as a separate entity on 13 December 2011 under the ticker "TME". Trade Me Ltd also operates several sister websites including Find Someone, Old Friends, Travelbug, Safe Trader, Holiday Houses and Treat Me.

Trade Me's website is the most visited in New Zealand before Google New Zealand, and is currently ranked 1,943rd globally according to Alexa Internet.[2] In 2006, the group of sites collectively generated over 60% of all web traffic originating in New Zealand.[3] In a country with a population around 4,177,000,[4] the Trade Me site currently has around 2,391,752 active members,[5] with approximately 70,000 people online and 1,390,000 auctions running during peak hours.

Participating traders primarily use New Zealand's banking system to settle payments, although Trade Me now offers sellers the ability to accept credit card payments by 'Pay Now'. Australian sellers must have a New Zealand bank-account, while sellers from other countries are not allowed on the site, which reduces the potential for fraud. Many buyers pay cash on pickup with larger items — probably partially due to the relative concentration of the New Zealand population in a relatively small number of urban areas.

Trade Me shares many features with other online auction-websites, such as eBay. Some of these features include "Buy Now", "Auto bidding" and the Safe Trader escrow service. Members in New Zealand can become "Address Verified" by confirming their street-address, and sellers may choose to block unverified members from bidding.

History[edit]

Origins and early development[edit]

A former Trade Me logo from October 1999

Sam Morgan founded Trade Me during the first few months of 1999, constructing the site while working full-time for Deloitte as a technology-consultant. Within Deloitte, Morgan worked on Internet projects and supply-chain issues.[6] During this time he witnessed the successes of online businesses like eBay and Yahoo, as well as the disasters of the dot-com bubble.

Trade Me founder Sam Morgan at Webstock 2008

According to Trade Me legend,[7] Morgan, then 23 years old, decided to found the Trade Me site when, despite searching online, he could not find a heater for his flat in Wellington. The Trade & Exchange site had a heater for sale, but held back listings for a week before publishing them online, and by the time Morgan made contact with the heater's owner, the item in question had already sold.

Morgan describes the initial designing and building of Trade Me thus:

"Some time later we were in a backpackers in Sydney and got evicted because it was overbooked. We went up to some backwater because it was the only accommodation we could find. Anyway, there was nothing to do, so that night I started drawing a data model. So it sort of started there really. Then when I came back to Wellington I literally sat on the couch and built the site on a laptop over a five- or six-week period."[7]

The site went online in March 1999 after Morgan pulled together as much funding as he could. It gained 155 members in its first week on the Internet.[7] In its early stages Morgan humorously listed Trade Me for sale on eBay with a $1 million buy-now price. Though eBay withdrew Morgan's auction, the prank sparked some interest among New Zealanders who realized the potential of online trading.

Trade Me developed slowly initially, because its founder had little funding to pay for the costs of hosting and of expanding the site. In addition, Trade Me initially offered a completely free service for both buyers and sellers, a strategy for expanding its member-base at the cost of short-term revenue. With little money and time available to work on the site, Morgan made the critical decision to sell almost half of his new company to his former Deloitte colleagues, bringing him around $75,000.

By August 1999 membership had risen to 3500, and Morgan could dedicate most of his time and funding to the site. The early strategy for Trade Me involved simply increasing its user-base and encouraging members to refer their friends to the site. Trade Me launched the Safe Trader escrow service about this time.

For a snapshot of Trade Me's early development see the Internet Archive's Trade Me archive.[8]

The running Kiwi in the Trade Me logo is named "Kevin" or "Kev" and his name can be seen by hovering over the site logo. Trade Me often change the logo and stylise Kevin to reflect major events in the calendar.

Growth and expansion[edit]

eBay proved unsuccessful in its 2001 effort to expand into the New Zealand market

In its early years Trade Me continued to struggle, slowly increasing its user-base, but facing financial challenges. The site initially used web-banners, but falling prices for advertising made web-banner revenue insufficient to cover expenses. Trade Me then introduced fees for auction services: first for features such as bold titles; then in September 2000 it introduced "success fees". This action proved the turning point for Trade Me, saving the site from potential financial disaster. Much of the success to come was based around the 'Trade Me Manifesto', a series of ten values for keeping the site fast and the company technology focused.[9]

eBay tried to enter the New Zealand market in 2001, but had little success. Trade Me has remained the major Internet-auction site in New Zealand, with both international and smaller national competitors gaining relatively little market penetration. Morgan commented on eBay's attempt to penetrate the New Zealand market in an interview:

"...I think there are big cultural issues there that are just not well understood. For example the Americans think that everyone has a zip code [...] they were a little late in and then they launched in US dollars."[10]

Morgan took time off from the stress of running the booming Trade Me site in September 2001, and went to the United Kingdom to manage an IT team in London. When he returned to his role at Trade Me the site had become profitable, with a membership of 100,000 and growing. By April 2005 this number reached one million.

In 2005 New Zealand's Deloitte/Unlimited Fast 50 rated TradeMe the fastest-growing NZ technology company for the previous year.[11]

Acquisition by Fairfax[edit]

TradeMe offices, Wellington (2006).

On 6 March 2006 the Australian media company Fairfax acquired Trade Me in a deal worth NZ$700 million, with an additional NZ$50 million payable if the organisation met earnings-targets over the next two years. (Those targets were met.) Sam Morgan and other executives remained with Trade Me.[12] Since the Fairfax purchase, Trade Me has continued to stand alone, with the former Fairfax NZ sites Jobstuff and Propertystuff being discontinued in favour of the TradeMe offerings.

In December 2012, Fairfax announced it was looking to sell off its stake in Trade Me in order to pay off debts.[13] The sale was confirmed on 17 December.[14] Its first profit report following the sale beat expectations, at NZ$37.4 million in the second half of 2012.[15]

Listings[edit]

Trade Me has increased its scope over time, and now offers a wide range of listing-possibilities. Customers can list the following items and positions on Trade Me:

Community and related sites[edit]

Old Friends has over 1,200,000 members.[16]

The online map site smaps, which provided convenient access to New Zealand street maps, was permanently closed in December 2008, leaving the niche to sites like Google Maps. Smaps was previously embedded in Trade Me Property & Travelbug listings ; both now use Google Maps.

Trade Me sites include:

Controversy[edit]

As a fairly open marketplace which is recognised globally, Trade Me experiences the same problems (such as fraudsters) as any online auction website does, and users need to exercise vigilance. In recent times, Trade Me set up a dedicated team which investigates fraud on-site and has a 100% record in gaining convictions for those offenders identified as using Trade Me as a medium.[18]

"Members can report fraud or listing that are in breach of the Terms and Conditions"[19] via the "Community Watch" (CW) feature, sited at the bottom of every auction. Contact with staff can also be made via the 'Contact Us' link at the bottom of every page however Trade Me does not provide a direct email address for customer support.

A website, www.scambusters.co.nz, functioned as an independent group of watchers of fraud on TradeMe. The group comprises amateur online members, and while they presented themselves as a site for reporting fraud on TradeMe, they had no affiliation to TradeMe, and therefore no access to some of the information or help that potential victims might need. A Facebook Group New Zealand scammers files claims of TradeMe fraud.[20]

To minimise payment-problems and reduce fraud, TradeMe restricted membership to residents of New Zealand and of Australia in 2005. This affected around 20,000 international members.

Trade Me's terms and conditions did not always specify a restriction to persons over eighteen years of age, although any user under the age of eighteen can not negotiate a legally binding contract. As recently as October 2005 the "Terms and Conditions" merely stated: "Becoming a member is free and there are no restrictions on who may become a member of Trade Me", with no mention of an under-eighteen-years-of-age ban. Prior to mid-2005 Trade Me did not restrict under-age users, even allowing them to enter in their correct birthdates upon sign-up. In June 2005 Fair Go,[21] a television-programme devoted to consumer-affairs, approached Trade Me Limited regarding this issue and featured the matter on a broadcast episode. In response to this, Trade Me Limited sent all the users who registered their date of birth as under eighteen an e-mail asking them to check and update their details if incorrect. Trade Me no longer allows users to register if they enter a birth-date indicating their age as under eighteen, but people under eighteen may simply represent themselves as older when they join.

Clashes with rivals[edit]

TradeMe's property marketplace.

In 2006 Trade Me laid a complaint with the Advertising Standards Authority (ASA) over the advertising of its largest property market competitor, Realestate.co.nz. According to the complaint, Realestate.co.nz, (run jointly by the Real Estate Institute of New Zealand (REINZ) and Property Page Ltd) had misled consumers with their advertisements with their slogan: "the only place with every place". Trade Me stated that it had properties listed on the Trade Me website which Realestate.co.nz did not have. Trade Me also detailed other reasons why Realestate.co.nz had allegedly breached the ASA's code of ethics and comparative advertising. The ASA upheld parts of the complaint.[22]

On 6 November 2008, Lixtor accused TradeMe of using bullying tactics. TradeMe said Lixtor was just trying to draw media attention.[23]

On 20 November 2008, a community newspaper The Aucklander also reported that TradeMe's lawyers asked Lixtor to remove their "Terms and Conditions"[24]

On 3 February 2009, in the wake of the emerging New Zealand copyright law Section 92a, New Zealand Creative Freedom Foundation published an article.[25] It was stated that Lixtor vs. TradeMe case is a good example of how the new section 92a in the New Zealand copyright law could be "misused", if passed.

Clashes with software developers[edit]

Various software developers have received legal threats after developing third-party software which interfaces with the Trade Me website.

On 19 August 2006 the New Zealand Listener published an article, "Bidding War"[26] on one such developer. The developer, Ciaran Riddell, created a piece of software, AuctionBar, which used a technique known as screen scraping. The software allowed for more detailed searches for goods on sale as well as bids and updates via text-messaging and a tool known as a "sniper", which acted as an automated bidding-tool.

Trade Me have since amended the "Terms and Conditions"[19] of the Trade Me website which now specifies "You may not use a robot, spider, scraper or other automated means to access the Website or information featured on it for any purpose" under s4.1(c).

On 7 May 2007 TradeMe released a Windows Vista Sidebar Gadget to run in the Windows Sidebar. This gadget, available on the TradeMe site, became the first sanctioned application to work with TradeMe. As the Vista Gadget requires an XML Feed, the gadget caused further discussion in the developer-community about why TradeMe did not have an API. It also led to other creations by the developer-community on top of Vista Gadget.

Trade me has now released an official API.

Notable auctions[edit]

Most popular auctions[edit]

As of July 2013, the most popular auctions were as follows:[27]

RankViewsClosedItem
11,319,21410 July 2013A printer which was stated to be faulty and 'possessed' was listed by nickftward to be on sale. He used quite a lot of humour and sarcasm to describe it, which made the auction more fun. His description:

"Words cannot express how much I hate this printer. It never works when I need it to - it's like it knows when I have to urgently print something. It randomly decides if it wants to work wirelessly or not. And scanning wirelessly? Forget about it! When you first turn it on it will play an endless symphony of sounds that are simply there to fool you into thinking that it might actually do what it's designed to do. Don't be fooled. This thing is evil incarnate." The winner of the auction was kornholio, with a winning bid of $280 ($1 Reserve Price)[28]

21,072,8933 June 2006Wellington Hurricanes player Tana Umaga hit team-mate Chris Masoe with a Roxy handbag at the "Jolly Poacher" bar in Christchurch after Masoe got into an altercation with a patron. The owner of the bag auctioned it via TradeMe for $22,750, generating a large media-story and over 1 million page-views before the auction closed.[29]
3810,80218 June 2009Mike Whittaker (mikew4) listed his old Kelvinator washing machine under the title 'Scary Washing Machine' due to its behaviour when washing. He created a fictional story about how it sucked his shoes, pants, iron and wife into a vortex, beyond which, there are dinosaurs. The pictures he drew of the supposed dinosaurs are being sold as fund-raisers for NZ charities. T-shirt company 'MrVintage' has created its own Scary Washing Machine Range of men's and women's T-shirts. The washing machine eventually sold for $5,160.[30]
4459,4201 August 2012The implosion of Radio Network House on 5 August 2012 was New Zealand's first ever controlled building demolition by explosives. Like most other buildings in the Christchurch Central City, Radio Network House was damaged beyond repair in the 22 February 2011 Christchurch earthquake. The right to push the button for the implosion was put up for auction and became the auction with the third highest page views ever. The winning bid was for $26,000 and the consortium of demolition contractors let the Child Cancer Foundation nominate a six-year-old boy from Queenstown.[27][31]
5355,88920 January 2012YOUR Tattoo on my Bum!!
6384,70524 May 2009Buy a Tractor and get a 20 acre farm for free
7316,3507 March 2011Landscape Rocks for Sale in ChCh (following the February 2011 Christchurch earthquake, there was no shortage of rocks, as whole cliffs had collapsed)
8292,1846 May 2010Folden 2010
9276,0948 January 2009Jesus Christ Pita Bread
10258,7759 January 2012Two days in the studio and advice from Neil Finn

Other popular auctions[edit]

Note: Withdrawn auctions become unviewable after 60 days and bid histories after 45.

See also[edit]

References[edit]

  1. ^ "Trade Me price fair, says Morgan". TVNZ News. 6 March 2006. Retrieved 17 May 2011. 
  2. ^ "New Zealand - Alexa record for trademe.co.nz". Retrieved 2009-13-20.  Check date values in: |accessdate= (help)
  3. ^ "Fairfax Media : News". Retrieved 23 November 2008. 
  4. ^ New Zealand census 2006 final figures, including overseas visitors.  [1]  PDF (370 KiB)
  5. ^ "TradeMe Statistics". Trademe.co.nz. Retrieved 23 December 2011. 
  6. ^ "Sam Morgan’s e-Business strategy - an i-Start exclusive" Date: March 2006 Accessed: 9 December 2006
  7. ^ a b c Carney, Michael (11 March 2006). "Hard road to online fame and fortune". The New Zealand Herald. Retrieved 23 November 2011. 
  8. ^ trademe.co.nz
  9. ^ Simpson, Rowan (2014). "Trade Me Manifesto « Rowan Simpson". rowansimpson.com. Retrieved 7 February 2014. 
  10. ^ "TradeMe: Big Fish In A Small Pond" 21 August 2006. Retrieved 10 December 2006
  11. ^ NZX: By Company Released 6 March 2006; Accessed 10 December 2006
  12. ^ "Fairfax To Acquire Trade Me, New Zealand's Leading Internet Business" 6 March 2006. Retrieved 10 December 2006
  13. ^ "Fairfax sells Trade Me to cover debts". 3 News NZ. 16 December 2012. 
  14. ^ "Fairfax completes Trade Me sale". NZ Herald. 17 December 2012. 
  15. ^ "Trade Me profit beats expectations". 3 News NZ. 21 February 2013. 
  16. ^ "Old Friends". Retrieved 10 June 2007. 
  17. ^ Rogers, Claire (15 March 2011). "Trade Me to launch Treat Me for retail bargain hunters". Stuff.co.nz. Retrieved 23 November 2011. 
  18. ^ Mauricio Freitas - Trade Me closing accounts?
  19. ^ a b "Terms and Conditions". Trademe.co.nz. 9 November 2011. Retrieved 23 December 2011. 
  20. ^ "New Zealand Scammers". facebook.com. 2014. Retrieved February 7, 2014. 
  21. ^ "Fair Go - Episode 14: June 8, 2005". Television New Zealand. Retrieved 23 November 2011. 
  22. ^ "Complaint to ASA (.rtf)". Retrieved 23 December 2011. 
  23. ^ Kloeten, Niko (6 November 2008). "TradeMe trying to 'intimidate', says auction rival". National Business Review. Retrieved 23 November 2011. 
  24. ^ The Aucklander - Newbie takes on TradeMe
  25. ^ "Guilt Upon Accusation: New Zealand Businesses". Creative Freedom NZ. 
  26. ^ The New Zealand Listener - Bidding War
  27. ^ a b "Illegitimate bids removed from demolition auction". Newstalk ZB. 1 August 2012. Retrieved 7 August 2012. 
  28. ^ "TradeMe Auction 611109951". Trademe.co.nz. 10 July 2013. Retrieved 10 July 2013. 
  29. ^ "TradeMe Auction 58555525". Trademe.co.nz. 3 June 2006. Retrieved 23 December 2011. 
  30. ^ "Scary washing machine. No really, its terrifying!". Trade Me. 18 June 2009. Retrieved 23 December 2011. 
  31. ^ Mathewson, Nicole (3 August 2012). "Boy to push button for implosion". The Press (Christchurch). p. A3. Retrieved 6 August 2012. 
  32. ^ "TradeMe Auction 25682983". Trademe.co.nz. 22 April 2005. Retrieved 23 December 2011. 
  33. ^ "Hug beats slap with bidders". Auckland-life.com. Retrieved 23 December 2011. 
  34. ^ http://www.users.bigpond.com/gavlewis/dolphin4sale.pdf
  35. ^ Gregory, Angela (1 October 2005). "Dolphin-for-sale hoax angers SPCA, DoC". The New Zealand Herald. Retrieved 23 November 2011. 
  36. ^ But on 24 May 2009, Allan and Shelly Holland from Gore, New Zealand smashed it. http://www.trademe.co.nz/Browse/Listing.aspx?id=218710429 TradeMe Auction 36725938
  37. ^ TradeMe Auction 52360702
  38. ^ TradeMe Auction 55824140
  39. ^ TradeMe Auction 57001645
  40. ^ "Banned & Restricted Items". Retrieved 26 May 2007. 
  41. ^ "TradeMe Auction 59664487". Trademe.co.nz. 16 June 2006. Retrieved 23 December 2011. 
  42. ^ "Bikini bid 'a hoax'". The Sydney Morning Herald. NZPA. 20 June 2006. Retrieved 23 November 2011. 
  43. ^ "virgin mary image on pebble for sale - TradeMe.co.nz - New Zealand". TradeMe.co.nz. 31 October 2007. Retrieved 23 December 2011. 
  44. ^ TradeMe - "Lixtor.co.nz FOR SALE starting bid $100,000,000 (Google Cache)" [dead link]
  45. ^ a b "''Scoop - "Lixtor is FOR SALE for $100,000,000 on TradeMe" ''". Scoopit.co.nz. Retrieved 23 December 2011. 
  46. ^ Lixtor.co.nz FOR SALE starting bid $100,000,000
  47. ^ Sachdeva, Sam (24 February 2010). "Bitter humour over Telecom's XT woes". The Press. Retrieved 23 November 2011. 
  48. ^ "Concern XT outages putting lives at risk". One News. 23 February 2010. Retrieved 23 November 2011. 
  49. ^ "XT Network For Sale". Trade Me. 1 March 2010. Retrieved 23 December 2011. 
  50. ^ "Trevor Mallard sells festival tickets online at a profit". The Dominion Post. 16 February 2012. Retrieved 17 March 2012. 
  51. ^ "Auction 488088955 --- FULL SIZE TRAIN FOR SALE". Retrieved 23 March 2013. 
  52. ^ "For sale: One electric train". The Wellingtonian. 26 June 2012. Retrieved 23 March 2013. 
  53. ^ "Going, going, gone - Trade Me train sold!". Greater Wellington Regional Council. 2 July 2012. Retrieved 23 March 2013. 
  54. ^ "TradeMe Auction 562594506". 
  55. ^ "TV in more adventurous Trade Me sale". 

Further reading[edit]

Two how-to books about Trade Me have appeared:

Insider Michael (MOD) O'Donnell published a comprehensive book on the rise of Trade Me

External links[edit]