MOTHER KNOWS BEST

MOTHER KNOWS BEST

From Chicken Soup for the Entrepreneur's Soul

Mother Knows Best

When Al Gore invented the Internet, I’m sure eBay was what he had in mind.

I, unfortunately, stumbled into selling on eBay only to shut my mother up about this eBay “hokeypokey” nonsense. She insisted that selling on eBay would be good for my storefront furniture and pool table business. So there I was at 1:30 A.M. in October 2001, staring at my computer screen with just eleven minutes and thirty-six seconds remaining in my first-ever auction. My $1,950 pool table had a high bid of $165. I figured I’d just lost a bundle—but at least I would prove to my dear mother that eBay may work for garage sale junk, not for a “real” business such as mine.

Depressed, I continued staring at my computer screen. I hit the F5 key to refresh the screen and there was finally another bid—wow, $170. I hit F5 two minutes later and, holy cow, it was now $400, enough to cover the shipping costs! With four minutes remaining, I began witnessing the magic of eBay every time I tapped F5; $1,200, then $1,825, then $2,000, then $2,175! When the auction time expired, I tapped F5 one more time. Final bid: $2,250—more than I would have sold it for in my store!

It had become clear to me, not to mention many economic experts, that the eBay juggernaut was, and continues, on a very successful path. Between the first and second quarters of 2003, eBay increased its earnings by 92 percent. Meg Whitman, eBay’s CEO, missed her prediction that the company would be doing $3 billion in sales by 2005; they exceeded their target more than a year early! In 2003 there were 80 million members on eBay, and by the end of 2004 there were over 115 million registered members. I am not alone in sincerely believing that the greatest success stories on eBay have yet to be written.

When I started selling on eBay there were a few good how-to books, but no proven models for success. So I built my own model that at one point yielded my eBay online stores close to a million dollars a month in real, tangible sales. This didn’t happen as easily as you may think. I had gained my share of experience in sales long before Pierre Omidyar founded eBay.

My first real job was selling kitchen knives for a direct-sales company during my senior year at Tulane University in New Orleans. Because my friends couldn’t afford knives, I sold them to my professors, then to their friends, and finally to most of the New Orleans Saints football team. That first year I had become the number-one sales rep in a company with 30,000 sales reps. I decided to skip law school and joined the company as a manager. Ten years and thousands of paring knives later, I left to work for an Internet start-up.

In March 2000, after two years of long hours and little pay building our Internet company, just as bankers were lined up and our IPO was ready, the dot-com bubble burst. Our company crashed, taking with it my hundreds of thousands of shares of stock options. At age thirty-three, I found myself out of work and $80,000 in debt. I needed a job quick.

I listened to motivational tapes about running a home-based business; exciting, but most of their “opportunities” were unrealistic. While I liked the idea of a home-based business, I settled on the reality of a small retail furniture and pool table store. I have never been a nine-to-five type of person, but I needed a steady income.

As I mentioned earlier, my first foray into the world of eBay was offering one of my overstock pool tables simply to satisfy my mother. That first success did not cause me to jump in with both feet. Initially, what I thought I had found was a neat sales channel for unloading extra inventory.

As I slowly began offering more items for auction, I ran into some unforeseen problems. Throughout January 2002, most of my auctions were getting shut down. After working with some of eBay’s legal and policy folks, I corrected the problems and no more of my auctions were shut down. A couple of months later, I found myself at eBay’s corporate headquarters as one of the specially selected sellers who periodically are invited to provide management with suggestions for improvement. What I saw and learned while at their San Jose “Ivy League” campus made me realize that eBay was a very big deal. The following week I closed my furniture store. I had just become one of the 175,000 people who were using eBay as their full-time source of income. I was riding eBay full steam ahead.

On eBay, the entrepreneurial spirit of the American Dream became the reality of a worldwide opportunity. Here, I had instant access to 115 million potential customers (and counting) without spending a dime on advertising. They hadn’t taught me that in business school. And because eBay wasn’t a business school subject, no successful eBay business models existed. To the benefit of small-business owners like me who possess the drive, energy and a bit of business know-how, eBay turned the traditional business model upside down, allowing us to compete successfully against the big guys.

What I learned in my eBay crash course provided me with a business model that allowed me to become extremely successful, yet most of what I learned is really basic business strategies:

• If you want to succeed, you begin by setting realistic goals. You then make the decisions and implement the actions that will advance you toward those goals.

• Competition forces you to be more competitive. Success means staying ahead of the curve, changing strategies as your competition catches up.

• You must venture into the unknown; that alone will yield great benefits and rewards. Very few people are truly innovative, and very few possess the courage to try new things.

• Accept responsibility for the outcome of things over which you have control. Mistakes are inevitable, and you will make your share. The key is to learn from them and move on.

My final advice to you? Make a beeline for your computer and go into business for yourself. The framework is there, compliments of eBay. Use it to make your dreams your reality!

Adam Ginsberg
As told to Ken McKowen

EPILOGUE: Adam Ginsberg discovered eBay in 2001, and just a year after he started selling his wares, eBay named him their number-one new seller (quite a feat, considering there are over 600,000 sellers on the site at any given moment). Ginsberg spent three years as an eBay “Titanium Powerseller” and personally sold over $20 million online during that time.

An expert in home-based businesses, Ginsberg strives to help others generate income on eBay. “My commitment is to teach others how to maximize their potential on eBay and online auctions—whether it’s to earn extra cash or to have a full-time business that you can operate from home,” shared Ginsberg. He established Ginsberg Consulting, designed to provide educational seminars, home-study programs, software and related materials available for purchase, all of which help accelerate the eBay sales learning process.

In 2005, Ginsberg released How to Buy, Sell and Profit on eBay (HarperCollins), a book full of expert tips and personal secrets on how to succeed using the nation’s top Internet selling site. He is also a much-sought-after speaker and media expert.

To learn more about Adam Ginsberg, please visit www.adamginsberg.com.

Ken McKowen

More stories from our partners