Online auction site to enter crowded market
Poland's online auction users will have more bidding choice following the start-up of another auction web site this week.
OneTwoSold.pl (www.onetwosold.pl) will initially offer 2,000 different products, but intends to increase the number of items to 20,000 by December due to advertising and promotions. The site's Austrian parent company, OneTwo Internet Handels, launched its first online auction site in its home country in February, and is setting up in Poland as the first of its four-country expansion into Central Europe.
"After four weeks we were the biggest online auction site in Austria," said Erwin Soravia, chairman of the supervisory board of OneTwo's parent company. He said the Austrian site (www.onetwosold.at) has gained 50,000 registered members, 300,000 page views per month and $100,000 a day in transactions.
Offering an explanation for OneTwo's rapid success in Austria, Thomas Huber, chief executive officer of Red-Stars.com, a Vienna-based internet incubator that provides capital and technological know-how to online start-ups in Central and Eastern Europe, said: "There is no other online auction house in Austria. On the other hand, (OneTwo) is backed by some of the most wealthy families in Austria that have deep pockets."
After OneTwo launches its Polish site, the company will start a site in Slovakia in November and in Hungary and the Czech Republic in December, said Peter Cesnak, who is overseeing the company's international expansion.
Zbigniew Pluciennik, the chief executive officer of OneTwo Internet Polska, said that at the outset, most of the items and services sold on the Polish site will be provided by the company's business partners. He said the company was wrapping up negotiations with partners for its Polish site, but declined to reveal names. He added that Austrian Airlines would be its first partner, auctioning plane tickets online.
The site will also facilitate consumer-to-consumer sales by allowing sellers to conduct their own transactions with buyers, and will be free of charge to both parties. The company's current total budget is $7 million, $3 million of which will be invested in its Polish operations during the next two years, Soravia said.
OneTwoSold.pl's strategy for generating revenue is built on an auction within an auction service that allows links to its partner companies where companies sell their products through their own online auction operations. The companies will pay a flat monthly fee of zl. 3,000 each for this service, Pluciennik said, adding that the Polish site will have 20 to 60 partners by the end of the year. Additional revenue will come from selling advertising banners and links, he said. Pluciennik said the Polish operations would break even in about two years.
Although OneTwoSold.pl joins a handful of other Polish auction sites, including E-aukcja.pl, Aukcje2000.pl, Interaukcja.pl, Allegro.pl, and Tomato.pst.com.pl, the company expects to be one of the major auction sites in Poland, Pluciennik said.
But Huber said that minor online auction players are usually doomed for failure. "I'm not convinced of auctions or auctions in auctions or third-level auctions in auctions in auctions," he said. "You need tremendous marketing efforts to be No. 1. The most famous auction sites are those that are well known and active globally. The top one or two (sites) will be profitable, but niche players have too little turnover in the market to be successful."
