Buy.com Offers Garage Sale Facebook App

Posted by on Aug 7, 2007 in Internet Applications, Social, Web 2.0 | 0 comments
This clip is from TC and it’s pulled from a post authored by Michael Arrington. I have to disagree with the assessment here and take issue with his main argument (below).

If I have a network of maybe 100 friends on Facebook, or even 10-20 and they are listing their stuff for sale with Buy.com’s widget, I might see something I’m interested in while browsing. The transactions don’t all begin with the buyer needing or wanting something, they could simply stumble upon a listing and like what they see, therefore creating the “want” to buy it.

I can see a large market developing for this type of transaction between friends and “online friends”.


clipped from www.techcrunch.com

But in practice this doesn’t work so well. Sellers are looking for a big base of buyers to sell into to leverage the network effect. eBay obviously does an excellent job of this. Otherwise there is no reason they would command a long term leadership position with their high fees. Buyers and sellers put up with the fees because it is the place to go to conduct p2p transactions. The network effect perpetuates their success and newcomers have a very difficult time gaining market share.

Closed networks work for some things, but they don’t seem to work for trading physical goods. My bet is that Garage Sale and Mosoma fall short of expectations, and that eBay is looking on with, at best, bemused interest.
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