Yahoo: Auction site improves with listing fee

Despite tacking on a fee for each auction transaction done on its Web site in January, Yahoo on Friday said its sales, bidding prices and the quality merchandise for sale on its Yahoo Auction site have all increased.

Yahoo in early January decided to charge a fee for listing items on the auction, such as a US$0.20 fee for listing a $1 baseball trading card or a $2.25 fee for listing a car with a target sale price of $5,000. That was a change from how the service started in 1998, listing all sorts of items for free, and allowed Yahoo to grow the auction site to critical mass, said Brian Fitzgerald, senior producer for Yahoo Auctions.

The move to a fee-for-listing structure has caused a decrease in the overall number of listings, Fitzgerald said. That decrease was not important as long as Yahoo maintained the same level of business, he said. Fitzgerald did not disclose how many listings Yahoo lost.

One positive change resulting from the decreased listings has been an improvement in the quality of items listed, Fitzgerald said. The number of listings declined and then leveled out in February, he said. Still, business remained strong, he said.

"It is a much more profitable marketplace than it was," Fitzgerald said. "Sellers are selling more items."

While Yahoo did not provide specific sales figures, the company said sales of items have improved from less than 10 percent of the total items listed to 31 percent of all items listed. On a given day, Yahoo has 3 million auction listings and ranks behind eBay Inc, which hosts about 6 million auctions daily.

Yahoo Auction's average selling price of items also increased to $62 compared to $40 an item prior to the listing fees.