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To assist American
sellers, Shop Airlines set up a customer service function. Sellers in the US
were asked to send the items that were bid for on the website to specified
locations in the country. At those locations, Shop Airlines handled the
formalities pertaining to customs, handling, and shipping before sending the
items on to the buyers in Japan. The payment method was also very transparent
because for all the purchases carried through Seikamon.com, PayPal9
was the default payment mode and buyers would get up to US$2,000 on their
purchases as part of its Buyer Protection program10.
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With Shop Airlines acting as a facilitator, cross
border bidding became much easier for both buyers as well as sellers in
Japan and US respectively. Shop Airlines charged 15 percent of the bid
value in addition to the shipping charges. The fee and handling charges
were borne by the buyers. Revenue obtained from bidding, advertising,
and as shipping charges was shared among Yahoo Japan, eBay, and Shop
Airlines.
As part of the second phase of the deal, a similar site for eBay US
users to bid and buy items displayed on Yahoo Japan Auctions was to be
launched in the middle of 2008.
The association was profitable for both eBay and Yahoo! because it
allowed the world leader in Internet auctions - eBay - and the largest
player in the Japanese Internet space -Yahoo Japan - to share resources.
Yahoo Japan displayed 15 million auction items on any given day while
eBay displayed 29 million items.
It was a good deal for users in the US and in Japan too as sellers got a
wide audience for their goods, while buyers were provided with an
extensive range of products to choose from. Financially also, the
collaboration was profitable for eBay, Yahoo Japan, and Shop Airlines as
the service fees were shared among them. In addition, they obtained
revenue through advertising.
But analysts were of the view that there were certain issues which could
make the transactions difficult. With respect to payment, most Japanese
users were not aware of PayPal and its usage had not caught up in Japan.
They were used to paying through their credit cards. Communication was
another problem because sellers could not communicate with Japanese
buyers directly as many Japanese users could not understand English and
Saikemon.com which acted as an agent between them did not support
translation services.
As a result, if buyers had any doubts they had to contact eBay directly
for which it charged a fee for translation from Japanese-English and
vice versa.
Japanese buyers also felt that the commision paid to Saikemon.com for
its services was high especially when small inexpensive items were
purchased. They were also not aware of the concept of 'handling cost'
and were not ready to pay it.
These differences often resulted in negative feedback from Japanese
buyers. But Siakemon.com was of the view that these problems would be
solved gradually and that buyers as well as sellers would benefit from
the deal.
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