Popularity of online bidding rises in crisis

By Shariffa Abdulrehman

For The Post

Online auction powerhouse eBay has dominated Western markets for nearly a decade, but Aukro.cz, based in Zlín, southeast Moravia, has captured a growing share since it was launched in 2003. Aukro is a subsidiary of Tradus, a firm that operates in countries where eBay is either not present at all or is not a market leader, for example Poland, Hungary, Russia, Ukraine, Bulgaria, Romania, Kazakhstan and Slovakia, among others.

In the Czech Republic, Aukro registers 1,500 new users every day and posted 1.3 billion Kč ($7.2 million) in sales in the second quarter of 2009. The Web site also sees 30,000 items sold daily through transactions totaling 12 million Kč. Aukro.cz Executive Director Vacláv Liška sat down with The Prague Post and talked about the growing popularity of the online auction and its further appeal during a recession.     

The Prague Post: More than 1 million Czechs tried an online auction last year. What has sparked interest lately, and what are the demographics among users?

Vacláv Liška: The great advantage of this type of e-commerce is price and a wide supply of goods. You can buy new, branded clothes cheaper than in shops. Another draw online auctions have is the unique experience that often becomes a sense of fun or adventure. Our users often say in our discussion forums that Aukro.cz is like a "drug" and that they are addicted. Lastly, Aukro.cz is an excellent opportunity for anyone who wants to start their own business with minimal costs.

We have more than 1.3 million registered users, and our most active users include mothers on maternity leave, collectors, students, young people and small traders. Among our buyers and sellers, males, at 57 percent, are considered a little more active than women. Our biggest age group for consumers who trade on Aukro.cz is between 20 and 39 - that group accounts for more than a quarter of our users. We've also found that users typically have a certain amount of disposable income, a secondary education and a net monthly between 15,000 and 25,000 Kč.

TPP: You offer services similar to eBay, although you don't operate in the same countries. How does your business model differ from theirs?

VL: Our operations are mainly focused in Central and Eastern Europe. These are the markets where we know the country specifics very well and adjust our services according to local users' needs. We use the same platform, which is consumer-to-consumer e-commerce, in most of the countries we operate in, but some features might be different from country to country.

For example, we have a Czech loyalty program. We launched this late in 2008, and it's a unique program we're not running in any of our other markets as of yet. It allows both our buyers and sellers to collect points for their activity on our site and later exchange these for items of their choice.

TPP: What have you done to maintain growth among your Web site's users despite the global economic downturn?

VL: We think our services present great opportunities for everyone, and this is even more valid during the economic downturn. Using our Web site, buyers can find items for the prices they are willing to pay. On the other hand, Aukro.cz is a great tool that allows traders to start selling easily without any significant start-up costs. We've continued marketing efforts aimed at bringing in new users and promoting our users goods on affiliate servers. We recently introduced a completely new platform that lets traders open an e-shop, Aukroshop. This is the next step for anyone who is really interested in trading in larger volumes, and this medium is open to shop owners, companies, entrepreneurs and private traders.

TPP: What are the most popular types of goods or services your users are buying and selling?  

VL: The biggest categories among items traded are clothes and accessories, collectibles and antiques, electronics, car parts and computers. For example, with clothing, we have a lot of sellers who trade brands from United States, which is popular because our buyers can't get these products anywhere else. Within this category, trading new items is becoming even more significant.

TPP: eBay tends to make the news whenever a particularly outrageous item is put up for auction, bringing helpful media attention to the brand. Do you have any examples of a particularly controversial or valuable item auctioned by Aukro.cz that attracted attention?

VL: The auction of the hip joint of President Václav Klaus provoked huge attention among the Czech media last summer. The seller requested 35,000 Kč for it, but our staff intercepted and withdrew this offer very quickly, as the sale of human body parts is forbidden on Aukro.cz.  

I'm afraid I can't say there was one special auction that caused a bidding frenzy. Everyone knows that when you try to bid for an item, and it's something that has really piqued your interest, you become mad and concentrate your efforts on obtaining that one item. Because of this, you bid and bid, higher and higher. Another high price set at auction that comes to mind was for the VIP skybox rentals for Madonna's concert at Sazka Arena in 2006. The winner of the auction said they enjoyed the concert with their trading partners at a price of just over 8,000 Kč.

TPP: What is Tradus' strategy for expanding the portfolio of services?

VL: Our strategy in a few words is "we love transactions." We want to focus on the whole e-commerce market and provide services that simply help users conduct transactions. In this line, we don't only offer auctions, but users can also use our classified services, shop platforms and online reservation system. This is the direction in which we want to continue.

TPP: eBay was launched nearly a decade ago. What are some of the trends or changes you've seen in the online auction sector since then?

VL: Generally, we see certain trends showing that the service is increasingly being used by sellers of new items. Aukro.cz is being used as a new, effective sales channel with a big demand, and retailers are starting to realize this. That's why the proportion of used versus new items is changing.

Shariffa Abdulrehman can be reached at
features@praguepost.com