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London-based auction Site CQout launched late in 1999. Founded by three graduates of the London Business School Sloan Masters program, CQout is hoping to give QXL and eBay UK a run for their money. I talked to Tony Newton, one of the founders, to learn more about his site.
"Our philosophy since inception was that the whole dot.com thing was the Emperors new clothes, and that an online auction site was no different from any other business: it needed to make a profit! That creates an interesting challenge...how do you promote your business if the numbers show that spending a fortune on advertising can never pay back in a month of Sundays?"
Newton told me that CQout relies on word of mouth for marketing, and they offer sellers a "no sale, no fee" policy. But what makes CQout different from many other auction-sites is that they've built in security features from the very beginning. While anyone can browse the site, users must register with a credit card before buying or selling. CQout runs a 1 pound charge through the credit card to validate the card.
"We know that this put a some potential users off, and indeed fraudsters, but those that elected to enter their details knew that they would be joining a secure, trustworthy trading community. Time proved us right."
The 1 pound registration fee (or equivalent local currency) goes to one of CQout's partner charities, specified by the user. The fee enables the company to validate the credit card in real time. CQout does not allow user names to change once they have been set up and associated with a specific address and credit card. If a user accumulates three negative ratings, CQout suspends them from trading and investigates further.
Sellers on CQout can choose two main listing options, auctions or fixed-price method. Conventional auctions last anywhere from 1-21 days. An autorepeat feature allows for automatic relisting of auctions a further five times using the same parameters and duration as the initial listing. CQinstant is a fixed-price option where the listing remains for 1 month or until sold.
CQout accepts bulk uploads in a variety of formats. It offers an escrow service (CQescrow) and instant sale facilities (CQinstant), and several back-end tracking, management and security tools.
CQout has users in 39 countries and plans to further develop its user base in the U.S. both for U.S./UK transactions and U.S./U.S. transactions.
Users can place and view auctions in their home currency, so having items listed and viewed in U.S. dollars is not a problem, Newton said. "As a generalist site, which is gaining a reputation in specialist categories such as movie memorabilia, we encourage traders to use us as an additional shop window for their merchandise, which may also appear on their own Web sites and other auctions."
The auction landscape is changing in Europe. Yahoo! recently shuttered its auction business in Europe and entered into a deal with eBay to allow eBay to advertise on the European Yahoo! portals. QXL ricardo, another major online auction site in Europe, is surviving, but has yet to be profitable.
For an interesting discussion of the state of European online auctions, visit http://www.auctionbytes.com/forum/phpBB/viewtopic.php?topic=993&forum=23&8.
As for the name of the company? Tony says it's CQout, as in, "we'll help Seek You Out a great deal!"
http://www.cqout.com
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