Buyers Bid Higher on Fancy eBay Listings

Buyers of iPhones on eBay spend more in auctions that are spiffed up to stand out on search results listings. Garnishes as simple as a headline in bold boost the closing price.

A study analyzing transaction data for more than 10,000 Apple iPhones that changed hands through eBay found four features a seller can add to promote their auction in search results and increase the winning bid.

The hot eBay market for iPhones, just after the United States release, gave researchers an avalanche of auction data. They mined results for 8 GB Apple iPhone auctions to learn what influences how much auction winners pay for their iPhones.

To make sure all the iPhones were of the same value, the study only looked at locked phones, those limited to operating on AT&T's Cingular Wireless network. The data also excluded auctions with a buy-it-now option.

Winning bids on eBay for an 8 GB iPhone ranged from $100 to $800 US during the summer of 2007. Since all were sales of new, identical iPhones, factors other than the item being sold led to differences in the final prices.

The University of North Carolina study found that iPhone price drivers included seller reputation, when the auction closed and how the auction listing appeared in search results.

How Much Extras Cost iPhone Buyers

Altogether, decorations on search listings added an average $25 to the selling price of iPhones. Having a bold headline, picture, highlighting or subtitle each upped the final bid price by $4 to $7.

Many sellers took advantage of these features. Half of successful auctions included a picture, while one-quarter used bold headlines and eight percent had highlighting.

Sellers also earned more when they used longer titles and subtitles to describe the auction.

The only extra that did not sway iPhone closing prices was featuring an auction at the top of search result pages.

Premiums that bidders paid for iPhones:

Feature in eBay Search Results	Average Increase in Winning Bid
Bold headline	$ 4.38
Picture	$ 5.86
Highlight	$ 7.45
Subtitle	$ 6.65
TOTAL	$ 24.34

EBay recognizes that sellers bring in higher prices by embellishing their auction's look in search results listings. So eBay charges sellers for every extra that might make their auction stand out. Even with the costs for upgrading, sellers in this study still yielded more profit when they enhanced their auction listings.

Features Close Auctions

Not only do enhanced listings boost selling price, but they also increase the chances that an auction closes successfully.

Slightly less than half of the 25,000 iPhones listed on eBay during the summer of 2007 actually sold. But bold headlines increased the likelihood an auction would close by six percent and including a picture by nine percent.

One embellishment, though, actually turned buyers off. Some sellers like to add several exclamation marks to a listing's title or subtitle. Auctions with excessive exclamations reduced the odds of closing by almost two percent.