Ask HN: How to prevent users from directly contact sellers on ecommerce site | Hacker News Reader

Ask HN: How to prevent users from directly contact sellers on ecommerce site

3 pointsisuleman2 comments

I am running a small ecommerce website in my city where multiple sellers can register themselves to sell their goods service, I charge a small fee on each sale and that's how I make money. But nowadays what's happening that those users directly contact those sellers and cut a cheaper deal. I give subdomain to each seller where they can display their name, products, and contact information is not hard to find these days. I am not a business savvy person, I just gave this idea trial run after graduating college so right now, I am kinda torn between drop it or keep going.

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Focus on the sellers. Customers have no choice but to shop where the vendors are comfortable selling, so your job is to make your site the best way to sell. Inventory management and updates should be smooth and painless, offer statistical information on views and sales, shipping options, payment processing, and customer service, make the direct contact between sellers and customers easy and incentivize them to close the sale using your platform by making that the easist way to proceed.

If both sides are determined to work around you, it's just a losing proposition, so get the one with something to lose on your side!

I was co-founder at an ecommerce site, Ruby Lane. We initially launched with a commission model also, but after a few years of pathetic income with hundreds of dealers, switched to a monthly listing-fee model. We lost many dealers from this, but it put us on a path to profitability within a couple of years.

The advantage of a listing-fee model is that your site is paid for displaying and managing the online product listings - not for selling them. If your listing fee is reasonable (ours was a quarter a month), sellers with high-quality items at reasonable prices will do well and will make more money than they can on a commission site. You can let dealers and users talk with each other however they want, going so far as to publish dealers' email address if they choose.

Commission-only sites tend to have lots more listings, but they also tend to have higher prices and junkier items, because there is no disincentive against these; listing fees are that disincentive.

As you have success with this pricing model, you can modify it down the road. For example, for example, charging higher listing fees for more expensive items.

Good luck!

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