AuctionCut

In our latest 6 Question Interview, Powerseller and Author of Ebay Made Simple Bob Hamilton recommends offering loss leading products on eBay.

4) Do you ever offer loss leading products, as a way of increasing your customer base or opt-in list & would you recommend this method?

Bob: Yes. We want prospective buyers to view our auctions. We know that eBay buyers are price conscious. We use low starting prices as our means of driving traffic and sales.

We've started many auctions out at 99cents. The majority of the time these have sold for a profit, but we have also experienced the product not selling or selling for 99cents which is at a loss. I would definitely recommend starting at 99cents or a small amount to get traffic to the auction listing.

Do you recommend this method or selling, or start any of your auctions at 99p?

http://www.AuctionCUT.com/6-question-interviews-f29.html

I regulary run a glitzy 10 day featured auction with a 1p start for a product that I sell at £16.99 from my shop. In the listing I will showcase similar items available on a BIN, and various other links around my eBay identity - reviews, About Me page etc.

The auctions tend to finish around £15, and I always offer a second chance, and sometimes a third chance, so the listing itself will normally break even. But in the 10 days that the auction is running, I will normally shift around £250-£300 of related items from the shop listings.

If you have the stock and turnover to cover it, a loss leader is well worth it and for the £10 or so that a featured auction costs, it can increase your store traffic by 5 fold if not more.
It's also worth looking for categories devoid of other featured items - I have listing in a category with over 13500 items, but it is only one of 2 featured auctions, and it is caning the page hits!