| Type | Auction/Classified website | ||
|---|---|---|---|
| Founder(s) | Sam Morgan | ||
| Headquarters | Wellington (main office) & Auckland, New Zealand | ||
| Employees | 190 Trade Me team | ||
| Parent | Fairfax Digital | ||
| Slogan | Where Kiwis Buy and Sell | ||
| Website | http://www.trademe.co.nz | ||
| Alexa rank | 1,213 (4th in New Zealand) | ||
| Launched | 1999 | ||
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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 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 second most visited in New Zealand after Google New Zealand, and is ranked 1,213th globally according to Alexa Internet.[2] As of 2006, the group of sites collectively generate 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[update] has around 2,391,752 active members,[5] with approximately 70,000 people online and 1,390,000 auctions running during peak hours.[6]
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.
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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.[7] During this time he witnessed the successes of online businesses like eBay, Yahoo etc., as well as the disasters of the dotcom bubble.
According to Trade Me legend,[8] 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."[8]
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.[8] 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.[9]
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.
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 #10 values for keeping the site fast and the company technology focussed.
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:
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]
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.
Trade Me has increased its scope over time, and now[update] offers a wide range of listing-possibilities. Customers can list the following items and positions on Trade Me:
The Trade Me site has a general messageboard where members can participate in discussions on a variety of topics, ask questions and seek advice. Controversial postings or flame-wars have occasionally resulted in interference in auctions by members with opposing views.
The Trade Me messageboard is community moderated: a post or thread may be voted off by as few as 10 members if they deem it offensive. This has led to abuse by certain members and groups who vote off popular threads that otherwise comply with the messageboard guidelines.
To help combat this problem www.votemenot.co.nz was created in November 2008 to allow messageboard members to archive threads that they feel may be voted off or expire.
The Trade Me messageboard received a major user interface upgrade in October 2009, adding 'quote' functionality and search.
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 and zoomin.co.nz. Smaps was previously embedded in Trade Me Property & Travelbug listings ; both now use Google Maps.
Trade Me sites include:
Trade Me received a major user interface upgrade in 2009. This new look Trade Me updated the look and feel of the site, and kept it up with developing web standards.
In particular the left hand navigation pane was removed from the homepage, and the whole site moved to a fixed width design. Ex. staffer Rowan summarised the changes.
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[update], 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.[19]
Members can report fraud or listing that are in breach of the Terms and Conditions"[20] 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.
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.
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 the National Business Review said[23] TradeMe tried to "bully" its rival Lixtor. TradeMe said Lixtor was just trying to draw media attention.
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.
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"[20] 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.
Note: Withdrawn auctions become unviewable after 60 days and bid histories after 45.
Two how-to books about Trade Me have appeared:
