Monthly Archives: March 2010

The Rule of 25

Perhaps the most common question asked by Trade Me newcomers: ‘Is it safe to buy on Trade Me?’ It’s a fair question. We are, after all, talking about a marketplace of invisible buyers and sellers dealing with products that might or might not exist. Do we really have that priceless vase in our possession and will we really send it to you once we have your money?

Keeping us honest
Incredibly, out and out fraud represents only a very small percentage of the tens of millions of auctions a year taking place on Trade Me. Yes, Kiwis are essentially honest and that’s a fabulous point in our favour. But the relatively smooth functioning of the Trade Me marketplace is mainly the result of deliberate engineering. Key components of this artificially induced honesty are:

  • The feedback system, whereby traders report on each transaction, means that those who attempt to rip off the system are quickly and effectively tagged. Go directly to jail; do not pass Go.
  • Trade Me’s decision to restrict selling to New Zealanders and those Australians who can offer payment via a New Zealand bank account has stopped the most blatant international fraudsters ripping off us 100% Pure Kiwis.
  • Trade Me’s Address Verification process, whereby you are sent a letter at a specific physical address, plays a major role in confirming that you do actually live locally and aren’t simply pretending to be a resident of Aotearoa.
  • Authentication, which requires members to make a small payment to Trade Me, creates a trail for investigators. As they say on TV, ‘follow the money’.
  • Use of the New Zealand banking system (via Internet or telephone banking) as the primary mechanism for Trade Me payment has effectively removed anonymity from potential fraudsters. If you pay money into my bank account and then I send you dud goods, I’m no longer just user dudtrader, emailing from You’ve got my (account) number.
  • The SafeTrader escrow system provides both a reality check and a helpful process for dealing with valuable items. If you specify on your auction listing that you’re prepared to use SafeTrader, that’s another indication of your trustworthiness. If buyers actually choose to use SafeTrader, their money is safe until they’ve had a chance to inspect the goods they’ve just bought.

Overall, the Trade Me system works hard to protect its members. Yes, there are still problems but they’re on a much lesser scale than they might be without the protective coatings applied by Trade Me.

Even so, it’s best to keep your wits about you when you go down to the Trade Me woods. Any collection of activities that relies on both buyer and seller being on their best behaviour does represent a risk. Allow us to guide you through 25 tips that will help you minimise the risks as you trade your way to fame and fortune.

  1. Before you even consider bidding, become familiar with the Trade Me website. Know and understand exactly what the Trade Me rules allow — and what (if any) protection you can expect, and under which circumstances (one way to learn all about Trade Me is, of course,  our Trade Me Success Secrets book).
  2. Know exactly what you’re bidding on. Read the fine print carefully and if there’s anything you don’t know, use the Ask the Seller a Question facility.
  3. Bid only on listings that feature photos. This will (slightly) improve the odds that the seller actually has possession of the product being sold.
  4. If you’re suspicious, check other listings for similar photos. An easy way for a somewhat more cunning fraudster to achieve a veneer of credibility is to steal the photos from someone else’s listing.
  5. If the photo looks particularly professional (eg, a crisp, clear shot with good lighting and/or background), then it may have been copied from an online catalogue. That doesn’t necessarily mean that the seller is a fraud; they might simply be saving themselves some effort, at the risk of copyright infringement — but it does mean that you can’t rely on the photo for proof of possession.
  6. Try to determine the market value of an item before you bid. Check out previous Trade Me sales for similar items. Look in retail stores or read advertising fliers to see what it costs to buy the item brand new.
  7. Find out all you can about the seller. Review their feedback page. If the seller has only a few feedbacks,  has feedbacks only on low-cost items or mostly has feedback for buying rather than selling, tread carefully.
  8. Check how long the seller has been a member of Trade Me (in the About The Seller box on each auction listing it tells you the date they joined Trade Me). New sellers, or those who have been members for a long time but not as active sellers, should be viewed with more caution than those who have been well-reviewed sellers over an extended period.
  9. Educate yourself about the items in which you are interested. Talk to knowledgeable sources, go to stores that sell such items, search online and get a better understanding of exactly what you should look for in such items.
  10. If the item is valuable because of its colour, size or some other attribute that isn’t necessarily clearly shown in a photograph, ask the seller for another photo from a different view, or for the item to be photographed alongside a common household product so that you can get a better understanding of the most important characteristics of the item.
  11. Ask yourself: Would I buy this if I saw it in a local store? Don’t get carried away just because it’s for sale on Trade Me.
  12. Consider whether the item comes with a warranty and whether follow-up service is available if you need it.
  13. Find out who pays for shipping and delivery. If you’re uncertain about what the shipping costs are likely to be, ask the seller before you place any bid. And watch out for extravagant allowances for postage and handling which can be a nice little earner for an unscrupulous seller – Trade Me’s rules essentially require shipping to be passed on at cost.
  14. Review the auction listing for the seller’s return policy. Under what circumstances will they take the item back? If there isn’t a policy shown (and in most cases there won’t be), ask the seller for details.
  15. Check the seller’s payment policy: cash, cheque, bank deposit or credit card? If the seller specifies cash only, that can be a warning sign — unless the item is a bulky one and the seller has specified pick-up only.
  16. Ask the seller as many questions as you need, to gather relevant information about the item on display. Don’t place any bids until you get straight — and satisfactory — answers.
  17. Remember, the seller is trying to make a sale. You can expect a certain amount of hype and liberal usage of descriptions such as ‘unique, rare, uncommon, vintage, retro …’ Ignore them.
  18. When bidding, know in advance what you’re willing to lose if the deal goes sour. $10? $100? Understand your risk threshold and try to stay within that range.
  19. Establish a top price and stick to it. If you decided the item was worth only a certain amount when you began the auction, it still is. Don’t get into a bidding war.
  20. Save all transaction information. A paper trail could turn out to be important if you have to go to the authorities.
  21. Take a screenshot. Save a copy of the item listing just before the auction ends, capturing the key image and description details, as a way of proving what was presented on the auction. Trade Me maintains images for a limited amount of time after the auction closes, but there’s nothing to stop the seller deleting the images immediately the deal is done. If you receive the listed item and it’s not in the condition shown in the photograph, you still have proof showing what the item was purported to look like during the auction.
  22. Know and understand what form of payment the seller accepts. Decide whether you’re willing to risk sending your payment before you receive the product or whether — if you have the option — you should pick the item up.
  23. After the auction, protect your privacy. Give out only the contact infor­mation required to receive your purchase; for example, supply a postal address in preference to a physical address and (only if a phone number is absolutely essential) a mobile number rather than a landline.
  24. If you need to send emails to a seller with whom you are in dispute, have a friend read your emails before you hit the send button. Even if you believe you have been ripped off, do not threaten the seller. Communicate in a fair and reasoned manner. Be polite and explain why you are dissatisfied. People do make mistakes when listing items, and many sellers will be willing to resolve the problem when approached in the right way. When you open with an attack, you leave the seller no room to respond reasonably.
  25. If the problem remains unresolved and you still feel that your rights have been compromised, complain to the appropriate authorities. If the seller is a professional trader you may be covered by the Consumer Guarantees Act and possibly the Fair Trading Act. Otherwise your best bet is your nearest Disputes Tribunal or even (in extreme cases) the police.

For more about online safety and Trade Me, see Chapter Three of Trade Me Success Secrets.

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