Fundamentals of Dynamic pricing and E-auctions Many Sellers, Many Buyers Buyers and their bidding prices are matched with sellers and their asking prices based on the quantities on both sides and the dynamic interaction between the buyers and sellers Electronic Commerc Prentice Hall 2006
Electronic Commerce Prentice Hall © 2006 11 Fundamentals of Dynamic Pricing and E-Auctions • Many Sellers, Many Buyers – Buyers and their bidding prices are matched with sellers and their asking prices based on the quantities on both sides and the dynamic interaction between the buyers and sellers
Benefits. Limitations and Strategic Uses of E-Auctions Benefits of e-auctions Benefits to sellers Increased revenues Optimal price setting Removal of expensive intermediaries Better customer relationships liqUidation Lower transaction costs Lower administrative costs Electronic Commerc Prentice Hall 2006
Electronic Commerce Prentice Hall © 2006 12 Benefits, Limitations, and Strategic Uses of E-Auctions • Benefits of E-Auctions – Benefits to Sellers • Increased revenues • Optimal price setting • Removal of expensive intermediaries • Better customer relationships • Liquidation • Lower transaction costs • Lower administrative costs
Benefits. Limitations and Strategic Uses of E-Auctions Benefits of e-auctions Benefits of E-Auctions to Buyers Opportunities to find unique items and collectibles ower prices · Entertainment Anonymity Convenience Electronic Commerc Prentice Hall 2006 3
Electronic Commerce Prentice Hall © 2006 13 Benefits, Limitations, and Strategic Uses of E-Auctions • Benefits of E-Auctions – Benefits of E-Auctions to Buyers • Opportunities to find unique items and collectibles • Lower prices • Entertainment • Anonymity • Convenience
Benefits. Limitations and Strategic Uses of E-Auctions Benefits of e-auctions Benefits to E-Auctioneers Higher repeat purchases a stickier Web site Expansion of the auction business Electronic Commerc Prentice Hall 2006
Electronic Commerce Prentice Hall © 2006 14 Benefits, Limitations, and Strategic Uses of E-Auctions • Benefits of E-Auctions – Benefits to E-Auctioneers • Higher repeat purchases • A stickier Web site • Expansion of the auction business
Benefits. Limitations and Strategic Uses of E-Auctions Limitations of e-Auctions Possibility of fraud Limited participation Security Auction software Long cycle time Monitoring time Equipment for buyers Order fulfillment costs Electronic Commerc Prentice Hall 2006 5
Electronic Commerce Prentice Hall © 2006 15 Benefits, Limitations, and Strategic Uses of E-Auctions • Limitations of E-Auctions – Possibility of fraud – Limited participation – Security – Auction software – Long cycle time – Monitoring time – Equipment for buyers – Order fulfillment costs