Here’s how we describe the moment of creation in Trade Me Success Secrets:

There’s a wonderful company legend that goes something like this: in early 1999, 23-year-old Sam Morgan was looking for a second-hand heater to help him survive a draughty Wellington flat. Being computer-savvy (in fact, he was an IT consultant for Deloitte at the time) Sam turned to the Internet to help with his quest, but couldn’t find what he wanted among New Zealand websites. The closest was the website for Trade & Exchange, but listings on that site were held back until a week after they’d been published in the paper. By the time Sam found an appropriate listing and phoned up, everything had been sold. That experience inspired him to create Trade Me.

Well, times have moved on, and the Trade & Exchange website is a fully-functioning service these days. Here’s what the T&E press release had to say about the impending closure:

As from the end of November, Trade & Exchange plans to close its paper publications in Auckland and Wellington and concentrate solely on its online service.

Managing Director, Peter Whitmore, said that online traffic had been growing and paper sales had been falling for several years now. “It has reached the stage where around ten times more people visit the website each week than purchase a paper. And compared to the papers, they gain access to around 50 times as many listings.”

Launched in early 1981 by Peter and Jill Whitmore, the Auckland Trade & Exchange was the first free ads paper in New Zealand and also one of the earliest in the world. In 1989 the Wellington edition opened and for a period there was also an edition serving the Manawatu, Wanganui and Taranaki areas. All these papers grew from small beginnings to become major classified advertising publications in their markets.

The Trade & Exchange web site. te.co.nz, launched in 1998, was New Zealand’s first major online trading site. Despite the success of Trademe with the auction model, TE has stayed with an open classified approach that allows buyers and sellers to contact each other directly, and gives the opportunity to view goods before a purchase is made. In terms of listing numbers it is now the largest free advertising site in the country.

“If we could keep the papers open we would”, said Whitmore, “because although most people are now online. there is still a dedicated group of readers who use the papers regularly. However, unfortunately circulations have reached a point where the papers are no longer economic to produce.”

It’s always sad when a publication closes. We wish T&E well in their new focus.

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According to those fine folk at Nielsen//NetRatings and their NZ Market Intelligence research, these were the top 10 websites in the Shopping category for December 2007:

• At Number 10, nzpost.co.nz/goshopping, which attracted 9,409 unique browsers across the month, looking for postage and packaging details.
• Number 9, mags4gifts.co.nz, Fairfax Magazines’ subscriptions-as-Christmas-gifts promotional site, 12,826 browsers.
• Number 8, interflora.co.nz appealed to 20,322 who like the thought of saying it with flowers.
• Number 7, smokecds.com, luring in 30,777 music lovers to this smokin’ music store.
• Number 6, torpedo7.co.nz, 46,051 extreme sport fanatics, on yer bike.
• Number 5, 1-day.co.nz, torpedo7’s one-day-deals site, lured 64,923 punters.
• Number 4, 121,564 visitors decided they’d like to sellmefree.co.nz.
• Number 3, designerexposure.com drew 192,909 in search of a little bit of luxury.
• Number 2, all that marketing drove 303,234 to ferrit.co.nz.

And, at Number 1, still champion after all these years, trademe.co.nz with a mere 3,532,434 unique browsers, more than eleven times the traffic of the Number 2 slot. Trade Me, take a bow.

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The main benefit of Pago, at least from a Trade Me perspective: Pago allows buyers to send instant cleared payments to sellers. If you have enough money in your Pago account (you can store up to $200) just send a text or email to the seller. If they have a Pago account as well, they get the money instantly. It speeds up the buying process as quickly as — well, as quickly as using a credit card.

At the time that Pago was launched, sellers couldn’t offer credit card processing on Trade Me unless they had their own merchant account or were signed up to PayPal. Pago seemed a great alternative, offering instant payment possibilities (although with the minor inconvenience of both buyer and seller having to set up a Pago account). Pago and Trade Me seemed a natural fit, with the Trade Me’s younger audience so wedded to their mobiles already. 

Unfortunately for Pago, however, Australian credit-card processor PayMate turned up on Trade Me (offering credit cards as a payment option) not long after Pago launched, to be followed in mid-2007 by Trade Me’s own credit card service Pay Now. Buyers, given the choice of using Pago or their existing credit card, are more likely to follow the path of least resistance — using a facility with which they’re already familiar. As a result, there’s been no particular pressure on Trade Me sellers to offer the Pago service.    

That said, however, there’s been some promotion of Pago of late, especially on the ASB Bank’s website, and it’s obviously having some effect. Latest Pago statistics:

• The Pago service is now growing by 200 customers a day 
• Pago has attracted more than 15,000 customers in 12 months
• Christmas shoppers have boosted transactions by 300% in November 2007
• The average Pago transaction is around $22

If you’re a Trade Me seller, you should offer as many payment options as possible. There may not be many Pago customers right now, but the sign-up process is pretty painless — and the offering might just one day create a sale that you wouldn’t otherwise have had.

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Should You Offer Pay Now?
Fascinating facts and figures on “Trade Me’s most important release of 2007″

Christmas in e-otearoa
What Kiwis want for Christmas, according to research from Nielsen//Netratings.

If you’d like to see a free copy of this month’s newsletter, just send us an email at newsletter@SuccessSecrets.co.nz with SAMPLE in the subject line.

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As the name implies, the Bill Me Later service enables customers to make online purchases now and pay for them at a later date. Shoppers click on the Bill Me Later option when checking out. The service asks the shopper for the last four digits of their Social Security number along with date of birth. The service does a quick credit check, okays the purchase and pays the merchant. Shoppers then receive a bill a couple of weeks later and consumers pay through online banking or mail a cheque.

Sooner or later a similar service will emerge in New Zealand, offering delayed payment terms to creditworthy customers. It’s a natural fit for Trade Me, and will make it a lot easier to buy and sell large-ticket items on the site.

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