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The SitePoint Market Watch #13 Copyright (c) 2009
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News, Rants and Case Studies for Web Entrepreneurs
by Peter T Davis
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INTRODUCTION - - - - - - - - - - - - - - - - - -
Hello SitePoint Marketeers! This week in Market Watch we'll jump
right into a difficult topic: what do you do when a situation
turns pear-shaped?
The Marketplace is generally very clean, but there are bound to
be misunderstandings, miscommunication, and unfortunately, an
occasional bad apple or two. There are approaches, however, that
you can adopt when faced with a problematic transaction. I've
also gained some input from Matt Mickiewicz, one of SitePoint's
co-founders, to help guide you along.
Naturally I'll follow up again with some handy tips for using
SitePoint's Marketplace. I hope you enjoy this issue.
Peter T. Davis
Editor
SitePoint Market Watch
IN THIS ISSUE - - - - - - - - - - - - - - - - - - - - - - - - - -
- Introduction
- Dealing with Problematic Transactions
- Tips for Buyers and Sellers
- Featured Listings
DEALING WITH PROBLEMATIC TRANSACTIONS - - - - - - - - - - - - - -
I rarely see accusations of outright fraud in a Marketplace
transaction. They do come up, but they're rare.
One of the most common criticisms I do see is when a buyer fails
to complete a transaction and the seller complains that they
still had to pay the listing fee. I asked Matt Mickiewicz about
this, who explained that from SitePoint's perspective, "the
listing fee is for the exposure to a potential audience of
buyers." Even if there was a failure to reach a successful
transaction, the exposure was still delivered to the seller. A
Marketplace listing "give(s) a great deal of power to the
auction holder, including the option of accepting or rejecting
individual bids." Matt went onto add that if SitePoint started
refunding listing fees for unsuccessful transactions, sellers
could then decline all bids, have the fee refunded, then arrange
a transaction behind the scenes -- and the Marketplace would
collapse.
SitePoint does track the percentage of listings that result in a
successful bid. However, there is no mechanism in place that
would track whether the transaction beyond the auction listing
was completed. Only the buyer and seller really know if money
changed hands. We obviously encourage buyers and sellers to
leave feedback for each transaction.
Auction giant, eBay [1], which also has a section for buying and
selling web sites (though, it's of a much lower quality than
SitePoint's, in my opinion), charges a nominal listing fee but a
substantial back-end fee based on a percentage of the winning
bid. SitePoint is exploring the introduction of a
percentage-success fee which might appease the sellers who feel
they've wasted their listing fee; I'm of the belief though, that
lowering the listing fee to eBay's level would be bad in the long
run for the Marketplace. The SitePoint listing fee as it stands
is a strong enough barrier to entry for the lower-quality
listings that now swamp eBay. They make eBay virtually unusable
for high-end buyers and sellers, the very people that make
SitePoint's Marketplace what it is today.
Matt (as well as myself) puts a great deal of stock in both
buyers and sellers doing their due diligence. The good news,
Matt tells me, is that "the upcoming relaunch of the Marketplace
introduces multiple new features to make due diligence easier and
faster." In addition to the basic tips -- such as researching who
you're transacting with and using an escrow service -- you'll
find countless other valuable tips in the How to Buy and Sell a
Web Site [2] section in SitePoint's Forums. I suggest starting
with the following thread [3].
When the worst happens, what do you do then? Even the most
experienced and sophisticated buyer can fall victim. We're
unable to offer legal advice and even if we were lawyers, there
are so many jurisdictions involved that it would be impossible
to be familiar with all relevant legislation. SitePoint does
offer a basic contract for web site sales, though, which is a
good starting point. Do consider a lawyer for higher-value
transactions. But, when it comes down to it, Matt says, "we
co-operate with all law enforcement requests for information."
Be careful. Be safe. Only enter into transactions if you're sure
you can handle the worst case scenario: losing everything -- the
money, the site, your time -- everything. Having said all that,
I do want to reassure you that it's rare; there is very little
outright fraud in the Marketplace. The more common complaints
are those of miscommunication, which can usually be solved by
being patient and talking it out.
[1] <http://www.ebay.com/>
[2] <http://www.sitepoint.com/forums/forumdisplay.php?f=265>
[3] <http://www.sitepoint.com/forums/showthread.php?t=558997>
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TIPS FOR BUYERS AND SELLERS
Always use an escrow service. I use mostly Escrow.com [1] and
Sedo.com [2] but there are others. Look in the forums for
recommendations from other members.
Know who you're transacting with. At the very least, Google the
person, but also consider doing background checks.
Verify everything. Obtain independent, third-party verification
of statistics, revenue figures, and any other detail you're
relying on when buying a site.
Don't "bait and switch". When you're selling, and the buyer
tries to talk you into an alternative payment method, be very
skeptical.
Know the history of the web site. Look it up in Archive.org [3].
Look it up using Domain Tools [4]. Google the site name. Give
honest feedback. Use the Marketplace feedback system wisely --
as an honest measure of transacting, rather than a tool of
revenge.
[1] <https://www.escrow.com/index.asp>
[2] <http://www.sedo.com/main.php3?language=us>
[3] <http://www.archive.org/index.php>
[4] <http://www.domaintools.com/>
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That's all for this issue -- thanks for reading! I'll see you in
a few weeks.
Peter T. Davis
peter.davis@sitepoint.com [1]
Editor, SitePoint Market Watch
[1] <mailto:peter.davis@sitepoint.com>
FEATURED LISTINGS - - - - - - - - - - - - - - - - - - - - - - - -
DiegoNorte.com For Sale!
<http://marketplace.sitepoint.com/auctions/62956>
HOT 6-7 figure Forex NetWork (5 sites). Last months net -
$54,238.61 On The Front End alone....
<http://marketplace.sitepoint.com/auctions/63012>
UK Established Boat & Marine Advertising Website
<http://marketplace.sitepoint.com/auctions/63844>
**Premium** Large Proxy Network $1700.00+/month 260,000+ UV/month
<http://marketplace.sitepoint.com/auctions/64047>
Well Established iPhone/Apple Site
<http://marketplace.sitepoint.com/auctions/63707>
ADVERTISING INFORMATION - - - - - - - - - - - - - - - - - - - - -
Find out what thousands of savvy Internet marketers already know:
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Find out how to get YOUR sponsorship ad in this newsletter and
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HELP YOUR FRIENDS OUT - - - - - - - - - - - - - - - - - - - - - -
People you care about can take charge of their Website by
effectively using the information and resources available on the
Internet. Help them learn how - forward them a copy
of this week's Market Watch.
ADDRESSES - - - - - - - - - - - - - - - - - - - - - - - - - - - -
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Ltd. All Rights Reserved. No part of this Newsletter may be
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