Since we launched Bonanza nearly four years ago, it has always been our top priority to drive sales. Along the way, we've received a lot of accolades for building the best user interface (AuctionBytes 2012), being the best marketplace for Collectibles/Antiques (About.com), or even being the best eBay alternative period (Ecommerce Guide), but at the end of the day we see our tools as a means to an end. It's great to be the most feature-rich, easy-to-use marketplace, and it's great to have the best support team we could hope for...but that stuff is really just the backdrop for our main purpose: helping stores make sales.
With that in mind, we are soon launching our biggest paradigm-shifting feature ever to drive more sales to our sellers' booths.
In the next couple days, we will be releasing an advertising platform that lets our sellers publish their Bonanza merchandise to Google Shopping (prominently featured, see screenshot) or eBay. In the coming months, we plan to add Bing Shopping and at least one other shopping platform.
The way the new platform will work is that you choose the maximum level of commission you can afford for your product, and we get you as many buyers as possible for that price. If your margins are small and you can only afford 3.5%, you will continue to receive the same level of exposure within the Bonanza.com marketplace, as well as Google and Bing organic search. If your margins allow you to bid higher, then we can take that extra commission and put it to work, automatically placing your item in front of as many buyers as possible.
For example, say that Barb has an antique frame that she bought for $100 and would like to sell for $150. In this case, Barb has a 33% margin to work with. Let's say that Barb uses our new publishing platform to set her maximum commission at "13%" to try to get her frame sold as quickly as possible (13% commission is on the high end). At that level, Bonanza can post Barb's item to eBay and get it prominently displayed in Google Shopping results (depending on the level of competition, and the quality of Barb's item). If Barb's frame sells quickly through Bonanza, her final value fee might end up still being 3.5% -- we charge her as little as possible, based on how much it cost us to sell the item. If it sells through eBay, her final value fee will be more like 10% (eBay's approximate FVF for an antique fixed price listing).
Our "big hairy audacious goal" for our item publishing platform is to help our sellers achieve the highest sellthrough rate of any marketplace or channel platform. And we want to do it at the lowest price amongst competitors.
By building a simple, tightly woven integration that works to acquire buyer traffic from all major sources, Bonanza empowers its sellers to decide the right mix of "low cost" and "high traffic" for their particular store. And over time, as ever more buyers discover the delight which is Bonanza and visit it directly, we can continue to lower the costs of advertising for all our merchants.
A mockup of the new advertising interface: Bonanza simplicity means that you're two clicks away from having your items advertised
I don't want to publish my items outside of Bonanza. What changes for me?
Nothin much. You can continue to sell your items at our standard 3.5%. However, given that Google Shopping and Bing Shopping are both moving to paid models for buyer referrals, the amount of traffic that you'll see arriving at your items will be limited to organic search engines and direct Bonanza traffic. This means that it can take awhile for you to find the right buyers, if you haven't built up your stable of repeat customers. Merchants with long tail inventory will be most likely to succeed in this scenario (since organic search loves that stuff).
How much do I need to pay to start advertising my items?
5% is the minimum level for us to be able to bid on Google Shopping traffic for you. However, we recommend bidding at least 9% since Google sends more traffic to those that can bid around that level. If you want to publish your inventory to eBay, that requires a minimum of 13% (which you pay directly to them, for their fees).
What do you mean that "I choose a maximum commission"?
Bonanza's advertising is setup like an easier version of Google Adwords. As in Adwords, you tell us the maximum bid you'll make and we charge less if we can. In our case, you tell us you are willing to pay when an item sells, and we will use that to figure out how much advertising we can buy for you. For sellers that have high sell-through rates, or sellers whose merchandise is in high demand, or sellers who have a lot of direct traffic from repeat customers, we can often manage to find buyers for them without spending the full commission they specify. In those cases, we pass our savings on to the seller. Our target is to have your actual commission average something in the neighborhood of 50-75% of your maximum commission.
How is it that Bonanza can be paying to buy me Google Shopping clicks before I've paid Bonanza?
This is indeed the major difference between Bonanza and every other advertising platform that we know of. We have built systems that understand the selling potential of a given item, so we can have our software automatically adjust the cost per click such that the risk is sufficiently low for Bonanza. That said, there will be many times where we pay for clicks to your items, your items don't sell, and we lose money. We accept that as a cost of doing business to help us reach our "big hairy audacious goal" (see above).
Those potential losses are justified to us, because we don't think that you want to learn how to calculate the optimal CPC cost for your items, so we're doing away with the complicated stuff and focusing on what matters to you -- what percentage of your profits are going to be spent on getting this item sold?
Wait, you allow publishing items to eBay? Aren't they the enemy?
We understand that many of our sellers have had bad eBay experiences at some point, and there are certainly aspects of the eBay selling experience that leave something to be desired. But at the end of the day, eBay can often be the fastest way to get an item sold, if you can afford the fees. For the sellers who are interested in making the most sales possible, publishing their items to eBay while using Bonanza's award-winning UI (all while getting paid advertising handled for them in Google Shopping by Bonanza) is a solution that will probably make a lot of sense.
How much do you recommend I set my max commission to?
Until you have uploaded good pictures, filled out all possible traits, and figured out a good title with rich keywords -- we recommend you spend nothing in advertising. Since each paid click increases your fee, you want to make sure that your items are maximally optimized to sell fast.
After you have created a detailed item with great pictures, the fastest way to get it sold is to bid 13% and publish to both Google Shopping and eBay. This puts your item in three high-traffic buyer locations (Google Shopping, eBay, and Bonanza itself), which gives you the best possible shot at a quick sale. And it's entirely possible that you'll end up paying less than 13% anyway (since we discount the cost when possible).
Why do I have to pay for traffic when it used to be free?
Bing and Google used to offer services that sent free traffic to ecommerce websites. Many sites sprung from everywhere, with so many free buyers to be had, courtesy of Google. Over time, Google found that 1) not making any money off such a valuable product sucked for them and 2) controlling the quality of your merchandise when anybody can submit items for free is very difficult. Making the seller have "skin in the game" can dramatically improve inventory quality.
The offshoot of these developments is that Google Shopping plans to turn off all free traffic in the next month, and Bing Shopping has increasingly been suspending (in their words "pausing" ) all large merchant accounts, including Bonanzas, as they progress toward what appears to be an emulation of the Google strategy.
The good news is that, for reputable and determined merchants, there has never been a bigger opportunity to capture the new traffic that becomes available as many merchants and marketplaces are cleaned off the shopping engines. The other good news is that capturing this traffic is relatively cheap (usually between 2-10% of the purchase price goes to the shopping engine).
And the best news is that Bonanza will be the first marketplace to allow you to directly take advantage of these changes to find a new wellspring of available customers as the holiday season approaches. Expect to hear more from us upon launch, coming soon...