iPhone Not Quite the Cash Cow eBay Sellers Were Hoping

Figure 1 - Breakdown of iPhone auction listings that were successful (48%), and those that were unsuccessful (52%)

Figure 2 - Breakdown between the 4GB iPhone model (13%) and the 8GB (87%) auction listings.

Figure 3 - Breakdown of the profit margins for iPhone listings on eBay

In case you've been under a rock, Apple launched their much-hyped iPhone over the weekend. Across the nation local news stations reported on the long lines forming at Apple and AT&T stores up to 12 hours before doors opened. Some just wanted the new toy, others were hoping to take advantage of demand and resell the gadgets on eBay at a hefty profit.

Imagine the surprise of those thriving entrepreneurs when the hordes of people flocking to eBay to pick up an iPhone failed to materialize.

I was curious at how well iPhone sales were doing on eBay after having heard several news stories about people who waited in line all day just to sell an iPhone or two on eBay. After browsing a couple pages on eBay the informal results were about what I expected - many of the overpriced iPhones were not selling. Of course, 1-2 pages of eBay listings represents nothing in the grand scheme of things, maybe 10-20 minutes depending on the frequency of the listings. I needed more data.

So, pleased to present my analysis of eBay iPhone auctions following Apple's hottest new product launch.

Data was compiled on all completed auction listings for the iPhone at eBay from 12:49am EST -- 09:26am EST on Sunday (July 1st). The analysis included 993 auctions and lasted for 8 hours and 37 minutes... just over a third of a day. 'Buy It Now' items were included, and data was compiled for both the 4GB and 8GB versions of the iPhone. Given that all of the devices were purchased from retail stores, an average 7% sales tax was also factored in.

Immediately, some trends were obvious - the most obvious of them being that users were largely selling just the 8GB model, with only 13% of listings being devoted to the 4GB model.

The other obvious (and more substantial trend) was that many of the iPhone auctions weren't selling, slightly over half came and went without a single bidder (52% to be exact).

Among those auctions that did close successfully, few were having the large markup that many expected to see the iPhone go for from third-party sellers... and a significant amount were only making their money back, even closing at a loss. In fact, the average profit on the iPhone (including the ones that didn't sell at all) during the analysis was $54.43; the median profit was even lower at $34.16.

So wait a minute, what's going on here... wasn't the iPhone supposed to be the most anticipated product since the Nintendo Wii?

Well, as Ken Fisher notes, iPhones are iPlenty. When Apple's own iPhone locater was last updated, most Apple retail stores still had the phone in stock, sans lines.

Of course this isn't to say that iPhone sales aren't going well - far from it. Carl Howe is estimating that sales of the iPhone could have been as high as 30,000 an hour during the peak of the launch.

Those that are still looking to get their iPhone need no longer turn to eBay or a line at the store: Apple just added the gadget to their online store... and with free shipping to boot.

...and just to prove I'm not @!$%#ting you on the massive data compilation, here it is in a 620k HTML file along with every corresponding auction number, should you feel like verifying 1,000 eBay listings.

47 Votes
Enjoy this article? Help vote it up the 'Vine.

Published to:

Corey Spring's Column, All of Newsvine
Groups: Journalism on Newsvine, Social News
Regions: none

What's this?

Who's leading the conversation?

This visualization below allows you to see the impact that each user has on the current conversation. The top row contains the group of users who have had the most impact, the 2nd row the group of users who have had the 2nd most impact (et cetera). Users with similar impact are grouped together, and the average score of the group is shown to the left of the group. The author of the article is also shown on the left, in their corresponding group. Each user's score is based on the number of comments the user has made plus the number of votes their comments have received. The scores are calculated relative one another, so while their absolute value is not particularly important, their relative difference does indicate a larger difference in impact on the conversation.

3.3

{"commentId":829156,"authorDomain":"faruk"}

...and just to prove I'm not @!$%#ting you on the massive data compilation, here it is in a 620k HTML file along with every corresponding auction number, should you feel like verifying 1,000 eBay listings.

You got so much respect from me for that footnote alone. :-)

{"commentId":829156,"threadId":"120464","contentId":"812167","authorDomain":"faruk"}

11 votes

#1 - Sun Jul 1, 2007 5:28 PM EDT

{"commentId":829200,"authorDomain":"brianford"}

Thanks for this, Corey.

I appreciate the effort involved in this -- and I suspect you'll get the Kudos you deserve for the Citizen Journalism you're providing.

My kudos aren't really for the information, or whatever, because I think everyone can do it and I wish everyone WOULD do it. My kudos are because you are doing it. If Newsvine hurts for content, it's because a lot of people are too busy complaining about the lack of content rather than CREATING the content. Being part of the problem means they aren't being part of the solution.

Here's hoping even one other Viner sees your efforts and puts forth some original content with some informative information. In many cases, info like this is just sitting out there, and waiting to be collected into an article by someone like you or me.

I still say that seeding links is easy, and presenting links is easy -- putting them into an an article like this with analysis and straight-forward presentation is far more important. Thanks for being part of the solution. It's good to see you posting more lately.

{"commentId":829200,"threadId":"120464","contentId":"812167","authorDomain":"brianford"}

11 votes

#2 - Sun Jul 1, 2007 5:48 PM EDT

{"commentId":829268,"authorDomain":"spring"}

Eagle-eyed readers will be able to spot what ate up much of my spare time over the last few months (and helped spurn a Vine sabbatical) by reading the tags on this article.

{"commentId":829268,"threadId":"120464","contentId":"812167","authorDomain":"spring"}

6 votes

#2.1 - Sun Jul 1, 2007 6:19 PM EDT

{"commentId":829292,"authorDomain":"brianford"}

So, you're saying that Corey Spring is in stock, you're just looking for the demand?

{"commentId":829292,"threadId":"120464","contentId":"812167","authorDomain":"brianford"}

7 votes

#2.2 - Sun Jul 1, 2007 6:34 PM EDT

{"commentId":829299,"authorDomain":"spring"}

More like the stock of Corey Spring became exhausted due to increased demand

...and that's what she said.

{"commentId":829299,"threadId":"120464","contentId":"812167","authorDomain":"spring"}

7 votes

#2.3 - Sun Jul 1, 2007 6:37 PM EDT

{"commentId":829293,"authorDomain":"graphix"}

graphix

What a bunch of fools...

thanks for the analysis

{"commentId":829293,"threadId":"120464","contentId":"812167","authorDomain":"graphix"}

4 votes

#3 - Sun Jul 1, 2007 6:34 PM EDT

{"commentId":829595,"authorDomain":"jcasabona"}

Joe Casabona

Nice analysis. I was thinking about this when I read the other day that only a few stores were actually sold out of the iPhone. It seems a lot of people were banking (no pun intended) on a shortage.

{"commentId":829595,"threadId":"120464","contentId":"812167","authorDomain":"jcasabona"}

3 votes

#4 - Sun Jul 1, 2007 8:46 PM EDT

{"commentId":829801,"authorDomain":"stevencwatts"}

Steve Watts

Between this and the PlayStation 3, I'm hoping people are getting the message and deciding to be more cautious and less brazen with these hair-brained get-rich-quick schemes.

{"commentId":829801,"threadId":"120464","contentId":"812167","authorDomain":"stevencwatts"}

6 votes

#5 - Sun Jul 1, 2007 10:15 PM EDT

{"commentId":829864,"authorDomain":"brianford"}

I'm not hoping that. I'm hoping they get stuck with a bunch of technology they can't afford.

{"commentId":829864,"threadId":"120464","contentId":"812167","authorDomain":"brianford"}

4 votes

#5.1 - Sun Jul 1, 2007 10:42 PM EDT

{"commentId":830605,"authorDomain":"beevine"}

beevine

Still can't find a Wii, though.

{"commentId":830605,"threadId":"120464","contentId":"812167","authorDomain":"beevine"}

3 votes

#5.2 - Mon Jul 2, 2007 9:08 AM EDT

{"commentId":830216,"authorDomain":"DrJuice"}

Dr Juice

Why just yesterday I blogged (apologies for shameless self promotion) a story I found on Digg about a woman in Texas who spent $800 to be the first in line at an AT&T store hoping to buy $16,000 worth of iPhones to sell on eBay. She was not aware that there was a 1 per customer limit at AT&T stores, and unfortunately the TV news crew didn't get any footage of her reaction.

{"commentId":830216,"threadId":"120464","contentId":"812167","authorDomain":"DrJuice"}

2 votes

#6 - Mon Jul 2, 2007 1:28 AM EDT

{"commentId":830393,"authorDomain":"faruk"}

They probably did, but she most likely didn't let them use that bit of footage.

I was reminded of that story too, I thought that was just precious. The guy who was first in line got a free iPhone out of it =)

{"commentId":830393,"threadId":"120464","contentId":"812167","authorDomain":"faruk"}

3 votes

#6.1 - Mon Jul 2, 2007 5:45 AM EDT

{"commentId":830570,"authorDomain":"spring"}

"I don't think she was too happy with you."

"I don't think she was either, and she didn't get a free phone"

{"commentId":830570,"threadId":"120464","contentId":"812167","authorDomain":"spring"}

2 votes

#6.2 - Mon Jul 2, 2007 8:56 AM EDT

{"commentId":830507,"authorDomain":"agio"}

agio

I call it the yPhone, as in, "y is everyone making such a big frickin deal about a phone"?

{"commentId":830507,"threadId":"120464","contentId":"812167","authorDomain":"agio"}

1 vote

#7 - Mon Jul 2, 2007 8:13 AM EDT

{"commentId":830617,"authorDomain":"spring"}

I like this moron who wants over $200,000 grand for his iPhone.

Shockingly, no takers.

{"commentId":830617,"threadId":"120464","contentId":"812167","authorDomain":"spring"}

2 votes

#8 - Mon Jul 2, 2007 9:12 AM EDT

{"commentId":830675,"authorDomain":"janeway77"}

Michael the Great

I saw one guy whose phone was bid up to over $10,000 (maybe it was two phones). Anyway, in his Q & A section he said that hoped his profits would pay for college or something.

I looked at the bid history, and the bids went from a couple hundred bucks, to thousands, and then jumped from $5000 to $10000. I said to myself, "Self, there is no way these are real bids. Somebody is just jerking his chain." I wish I knew what ultimately happened.

Now get this... e_Bay will charge him the sale commission on the $10,000 as though it won. It will be about $400. Then, he'll have to go through the hassle of showing that it was a non-paying bid, and he didn't get paid, and he'll have to pay for college after all, and ..... Meanwhile, he'll have this $400 charge on his credit card while it is being resolved.

Poor guy. I wish him well on his entrepreneur desires.

{"commentId":830675,"threadId":"120464","contentId":"812167","authorDomain":"janeway77"}

2 votes

#8.1 - Mon Jul 2, 2007 9:37 AM EDT

{"commentId":830771,"authorDomain":"brianford"}

Congrats!

Daring Fireball -- the holy grail of linkage for any self-respecting mac user.

{"commentId":830771,"threadId":"120464","contentId":"812167","authorDomain":"brianford"}

4 votes

#9 - Mon Jul 2, 2007 10:16 AM EDT

{"commentId":831791,"authorDomain":"spring"}

C|Net's Crave blog, too.

Write it and they will come, people.

{"commentId":831791,"threadId":"120464","contentId":"812167","authorDomain":"spring"}

2 votes

#9.1 - Mon Jul 2, 2007 4:04 PM EDT

{"commentId":833436,"authorDomain":"faruk"}

Damn, I got the DF linkage for my Zune satire piece, but no other major blog…

You winz! ;-)

{"commentId":833436,"threadId":"120464","contentId":"812167","authorDomain":"faruk"}

#9.2 - Tue Jul 3, 2007 7:22 AM EDT

{"commentId":830920,"authorDomain":"caesara"}

Hatuxka

So a phone locked to one provider (ATT) and with low-end iPod capacity and costing a fortune for those two main things is not selling big on eBay or elsewhere? Gee, I wonder why not.

{"commentId":830920,"threadId":"120464","contentId":"812167","authorDomain":"caesara"}

2 votes

#10 - Mon Jul 2, 2007 11:05 AM EDT

{"commentId":831082,"authorDomain":"a3dmofo"}

a3dmofo

Just to add to this a bit more, because I was watching this pretty much all weekend, the morning of June 30th iPhones were selling on eBay at a pretty high clip actually. I watched several phones go for $1,500+ early Saturday morning. But it was interesting to watch because we are so accustomed to shortages these days that people were adding iPhones all day long on Saturday, there were literally around 6,000 of them listed on eBay Saturday mid-morning, and that carried through Sunday. By Saturday evening they had slowed to going about $850-$1,000 and by Sunday is was a massacre of overabundance, as you pointed out, phones were going for barely retail and people where pulling their items out right and left.

And in the interest of full disclosure, I will admit I was obsessively watching it because I did try to dip my toe into the pool on this. It was an interesting and stressful experience, and it was something about being caught up in the moment. I never thought I'd do that, but when I saw a chance to maybe get myself a free iPhone, I was to tempted to not try. I am happy to report though that both myself and my buyer on eBay came to our senses and we mutually agreed to cancel the transaction and I can't say I'll ever try it again. In the end I didn't lose anything but some time and maybe added some gray hairs.

I am though, quite curious to see if we'll see revised sales numbers after thousands of them are returned this week from not selling on eBay. :D

{"commentId":831082,"threadId":"120464","contentId":"812167","authorDomain":"a3dmofo"}

1 vote

#11 - Mon Jul 2, 2007 11:48 AM EDT

{"commentId":831165,"authorDomain":"spring"}

Oh, I imagine even then they'll be doing all right, selling half a million units in one weekend ain't too shabby ;)

{"commentId":831165,"threadId":"120464","contentId":"812167","authorDomain":"spring"}

2 votes

#11.1 - Mon Jul 2, 2007 12:15 PM EDT

{"commentId":831155,"authorDomain":"jeremyemalheim"}

Jeremy E. Malheim

I was quite pleased to see Apple was on the ball with production. Scarce product numbers does not translate into cool gadgets as far as I am concerned, it translates into poor planning on the companies end. While I do feel it is everyone's right to grab a first in line and throw it on eBay, I admit to feeling quite smug about the gougers who are not going to have any luck this time.

{"commentId":831155,"threadId":"120464","contentId":"812167","authorDomain":"jeremyemalheim"}

1 vote

#12 - Mon Jul 2, 2007 12:13 PM EDT

{"commentId":833176,"authorDomain":"zaki"}

Zaki

You got mentioned on the Cult of Mac blog, congrats

{"commentId":833176,"threadId":"120464","contentId":"812167","authorDomain":"zaki"}

1 vote

#13 - Tue Jul 3, 2007 12:45 AM EDT

{"commentId":833250,"authorDomain":"spring"}

...and CBS News

(that's like a real news source! Sorry I hate to toot my own horn, but that's pretty cool.)

{"commentId":833250,"threadId":"120464","contentId":"812167","authorDomain":"spring"}

1 vote

#13.1 - Tue Jul 3, 2007 1:37 AM EDT

{"commentId":833439,"authorDomain":"faruk"}

CBS news -> now That deserves a Congrats from me, for sure :-)

Congrats!

{"commentId":833439,"threadId":"120464","contentId":"812167","authorDomain":"faruk"}

1 vote

#13.2 - Tue Jul 3, 2007 7:23 AM EDT

{"commentId":836971,"authorDomain":"spring"}

And also one sexy mention in Forbes

{"commentId":836971,"threadId":"120464","contentId":"812167","authorDomain":"spring"}

#13.3 - Wed Jul 4, 2007 9:57 AM EDT

{"commentId":893721,"authorDomain":"sheil"}

Sheil Naik

Forbes and CBS? Wow.

{"commentId":893721,"threadId":"120464","contentId":"812167","authorDomain":"sheil"}

#13.4 - Wed Jul 25, 2007 11:09 AM EDT

{"commentId":837875,"authorDomain":"FJKB"}

FJKB

I am not nearly as talented of a statistician as the Corey, but it appears that the margins of Nintendo Wii (not sure how to pluralize) on Ebay is significantly higher almost 8 months after the product launch.

My feelings regarding this is that Apples / Steve Job's unbearable self confidence had them in a position to be ready to meet demand while still making an unheard of Profit Margin. Granted there was a significant risk of producing "New Coke"! Kudos must be given where deserved.
FJKB

{"commentId":837875,"threadId":"120464","contentId":"812167","authorDomain":"FJKB"}

#14 - Wed Jul 4, 2007 3:51 PM EDT

{"commentId":859024,"authorDomain":"stevetranter"}

Sting

Mentioned here too...

{"commentId":859024,"threadId":"120464","contentId":"812167","authorDomain":"stevetranter"}

#15 - Thu Jul 12, 2007 7:01 AM EDT

{"commentId":862166,"authorDomain":"stevetranter"}

Sting

ebaygoldmine.org

{"commentId":862166,"threadId":"120464","contentId":"812167","authorDomain":"stevetranter"}

#16 - Fri Jul 13, 2007 7:54 AM EDT

{"commentId":893714,"authorDomain":"sheil"}

Sheil Naik

Holy freaking crap. Nice analysis Corey. This is the kind of stuff I eat up, and especially after reading Freakonomics, I'm in love with data mining. Again, incredible analysis. You're the man.

{"commentId":893714,"threadId":"120464","contentId":"812167","authorDomain":"sheil"}

1 vote

#17 - Wed Jul 25, 2007 11:08 AM EDT

{"commentId":897800,"authorDomain":"spring"}