Recently I wrote about a new auction-based marketplace called Tophatter.com. I sold my first item there on Monday and want to share my experience with this Tophatter review.
There were dozens of lots (listings) on auction that Monday morning and mine was scheduled at the very end. I got in the party at 11am central and hung around multitasking with admin work while I waited till it was my turn. Every now and then I would make a comment or answer someone's generic question. I had set my “name” to “tinyhandsonline.com”, my entire URL to my shop so that whenever people saw my comment in chat, I could kill two birds with one stone: people would know my brand name AND my url at the same time.
I set to receive a text message when my listing would soon be on auction, and true to its word I got a buzz on my cellphone with a nice message. I had waited a little past an hour.
Mind you, when your item gets put on the spotlight, it's a very fast process. I'd say I was typing as fast as I could to answer questions and pitch my product, and it all took no more than 2 minutes until my auction was settled.
On the interface, bidders get to view information like product name, pictures and a description. Tophatter doesn't mention this, but you can write simple HTML to include <a href> links to make your product copy more interesting. Don't forget to add your website or Etsy page link here so people can find you during or afterwards. As a consumer it's always interesting to see the story behind a handmade product, such as the person who made it and their work process, for example. This was a good chance for me to show off my branding with my website.
I got lucky on my first time though. It was only a few days after the above waffle necklace was featured on a Parks and Recreation episode where Amy Poehler aka Leslie Knope wears my necklace through the entire episode.
So I knew I had something very news-worthy to pitch in my short time in the limelight.
When your item goes up for auction, the auctioneer tells everyone the retail product price range. This is where it gets interesting! When I set up my listing, I was asked to specify my exact retail price for my necklace. It goes for $28 on my website. At the time of the auction, however, everyone else can only see a price range, i.e. “$25-$30”.
This makes total sense, because if Tophatter had blatantly showed the exact price (even though it's easy to find on my website), no one would ever bid above the retail price. Why would someone bid $30, for example, if they found they can buy it on my website for only $28?
The price range gives people a good idea for how much the item is worth, without really giving away the exact value. Good move there, Tophatter.
So I was chatting with people about my Parks and Rec 30 minute fame on TV. I barely had time to look at the live current bids. I started my minimum bid at $10, close to my wholesale price. And eventually it sold for $24. Tophatter takes a 10% commission off your winning bid, so eventually I received a Paypal notification for $24.60 ($24 winning bid + $3 shipping – $2.40 commission).
I made just shy of $19 for the necklace. That's a 32% discount off my retail price, or a $9 cost all together.
Let's make sense of those numbers:
When I entered the auction, I saw a total of 70 people already inside. I wasn't keeping track of how many people came and went, or how many people there were left at the end of the auction. You can easily argue that products for sale at the earlier end (or maybe at the later end?) would have had more attention. I had at least 7 people come to my website to browse within 24 hours of my auction going live. I say “at least” because there are always discrepancies, and you never know who searched your shop name in search engines from when they saw it at Tophatter. Assuming 70 people were in the auction, 7 people converting to my website makes that a 10% conversion rate, which I'm pleased with. These 7 people spent an average of 7 minutes 2 seconds on my website, which is a very nice. From this, I know they're engaged and interested. Who knows, these 7 people might come back later… and eventually buy something!
Now, my item will be on the Tophatter website for a bit. They list a archive of past auctions for 2 weeks, so anyone looking through this may click my link too in the next 14 days. I know, statistical data like this is finicky, there's no exact number, just estimates and averages.
For $9, I'd have to say this marketing promo was so-so. Tophatter's 10% cut is steep, but considering that they provide you an instant sale, that's not too much to ask. I had some short time for chatting with people in real time, and even had some people convert into website visitors. Plus I gain 2 weeks for being listed in their archives for people to see. I'd like to view this as not just a one time sale, but also as another way to market your shop. Something like this does have long-term effects on your overall business.
I might do it again for fun, or when slow sale days come along. Remember, the more successful sales you do, the higher your Tophatter reputation, allowing you to have more freedom and flexibility in posting more items in the future.
The risky thing with Tophatter, however, is that you could potentially sell your item for waaay less than your retail price. My cost could have been so much higher. Apparently it was a “bad day” in the auction house, and people claim to experience better bidding response on other days. To minimize this risk, set your minimum bid to somewhere close your wholesale price so you don't lose out too much.
Have you sold on Tophatter before? What was your experience like? If you have any questions, fire away!