The analysis is being carried out based on the sample data gathered from online auction eBay for the successfully finished listings. After the initial data was pre-processed the final sample has been reduced to 3180 listings of iPhone 5S and iPhone 5C during the 9 day period from March 22 to March 30. The results of the listings distribution for auctions are below:
This data is quite interesting, as it points out that the more expensive and more premium iPhone 5S is selling more actively than a cheaper iPhone 5C. In reality, this was supposed the over way around, as the iPhone 5C was meant to be more mass appealing to the public due to its lower price and hip design.
This initial finding could indicate, that selling a cheaper version of a product alongside its premium counterpart could not be worth it. It is not only happening on consumer level, as channel members, whether at the wholesale or retail level, develop certain perceptions about the kinds of products with which particular manufacturers are associated. To analyze this theory further the amount of listings for new and used phones has been compared for both models.
The results listed above provide us with another hint, that the people were not pleased with iPhone 5C in the first place. Both models came out in the same time and were available for sale since September 20, 2013. Yet, the number of used iPhones 5S sold on eBay is almost equal to the number of new phones sold of the same model (1002 vs 996). For the cheaper model, though, the difference between the used and new listings is higher by 56% (720 vs 462). People clearly looking to sell their iPhones 5C and get something better.
Finally, we have analyzed the price for new phones of both models. In this analysis, only phones with storage of 16GB and 32GB were taken into consideration. Before the final numbers were analyzed, the outliers were removed to make analysis more cleaner (z-scores were used to identify outliers). The outliers were not taken into consideration. For the remaining phones sales the findings were as follows:
The above table shows, that on auction site eBay 5C model is being sold for -16% discount to the official price available on the Apple store website. At the same time, on average 5S is being sold only for a -2% discount to the official price.
What is the takeaway from the findings above? Apple used its brand name on a cheaper version of its flagship phone hoping to gain a bigger market share. They used their regular distribution channels and marketed product to the same people, to whom they market their more expensive and feature rich model. As a result people are willing to sell the brand new product at a steeper discount than on official website.
This is what every person starting selling products on eBay should keep in mind – is it actually the right platform for his product, will people visiting website will actually be searching for his merchandise or they would prefer other distribution channels. While the website itself is vastly popular, and millions of people visit it every day, they may not necessarily be your visitors as you are not selling what they are looking for. It could be that people are looking for only low valued items in your niche, because they don’t trust online transactions or they prefer to see the item physically. It could be other reasons, so it is important to first research the channel and whether there is actual demand.