The NZ marketplace market: TradeMe, FB Marketplace, and the void for new startups.

5 min readJan 31, 2020


This week TradeMe announced that it would be increasing its success fees, in a post that has caused outrage from some people. However the new fees are only aimed at professional sellers, I think this is a good move, and would say it doesn’t go far enough.

As the first successful digital marketplace in NZ, it has been the prominent online auction site for Kiwis for the better part of two decades, but as with any incumbent, tech changes will threaten that. TradeMe has outgrown and acquired many competitors over the years, but what are its origins and will it be enough to outmatch new startup competitors?

TradeMe’s line used to be ‘Where Kiwi’s buy and sell online’ and to this day it remains true to that as the #1 auction site.

Founded in 1999 by Sam Morgan, TradeMe remains one of NZ’s greatest startup stories. With over 20 years of market domination, it remains a major employer in the country, and up until last year was a publicly traded company, when it was bought and de-listed by a US-based group.

As the first online marketplace in NZ, TradeMe’s model of user experience is primarily an auction website, that also happens to have an app.

In a time when smartphones are king, its days on top are numbered.

TradeMe revolutionised the way we bought stuff in the 90s.

Thursday was the secondhand shopping day, as it was the day the Trade and Exchange went to print. The T&E was a weekly paper, devoted to classified ads from people who had something for sale.

As a kid, I remember listening to my Dad and Uncle pouring through the pages of listings, while I played with my box of 1980s space LEGO (a treasure chest of nostalgia from the T&E). You could buy anything on there, furniture, dogs, TVs, my Uncle once bought an ex-army landing craft…

Back then, you scoured the weekly listings for one you liked, phoned up someone who you didn’t know if you could trust, to negotiate viewing of an item that you didn’t even know was still available.

TradeMe was born out of that frustration, Morgan founded the online auction site after chasing down a heater listing on the T&E website, only to find it had sold more than a week before (online listings were delayed a week to promote paper sales). The model was similar to eBay, the globe’s top auction site, in an effort to provide a platform that regulated the listing and selling process in an obvious format.

TradeMe’s price hikes are not targeted at people buying and selling heaters.

Today, TradeMe resembles more of a one-size-fits-all marketplace. Listings range from an overwhelming amount of cheap-to-produce crap, to faithfully restored classic cars.

The price hikes that have irked so many people are part of a suite of new charges aimed at professional, high value sellers, and more specifically at motor vehicle market. These professional sellers leverage the large audience, and well known platform to flood their listings onto the site, the like of Turners, the largest secondhand vehicle retailer in the country.

Some may see this as the US based TradeMe owners trying to squeeze profits from NZ companies, but since the introduction of international sellers, TradeMe’s focus has hardly been ‘Kiwi companies first’. To most everyday Kiwis the price hikes will have little daily impact.

Personally I would like to see these professional seller fees pushed out to more sellers, in a move to limit the amount of AliExpress type, mass produced junk on TradeMe. So where do these kind of sellers belong?

Online sales in the instant era.

In true Zuckerberg fashion, Facebook is rapidly screwing over P2P marketplaces, we are connected to our phones and our feed constantly. We like instant messaging and the ability to get things right away, FB Marketplace is becoming a favourite for many people with its no fee, accessible and instant platform. You can spot something you like, chat to the seller, confirm the purchase and head to pick up, all within a couple of hours.

Not actually a stock photo! We just furnished our new place almost entirely from Carousell, managing to gather an apartment’s worth of stuff, all secondhand, super cheap in less than a week.

Suddenly the online auction site model seems outdated for selling our used TVs and couches or picking up a new USB charger.

Many other countries boast modern, rapid trading platforms similar to the instant ability of FB Marketplace, Singapore’s Carousell has the line ‘Snap to sell, chat to buy’, a MO that makes buying and selling stuff that someone else doesn’t want, but you need, super slick.

These companies fundamental user experience is based around smartphone features, it’s the same user experience that FB marketplace has leveraged.

So what is the gap in the market?

New Zealand needs a mobile first marketplace.

I imagine something along the lines of Carousell, ‘Snap to sell, chat to buy’. A mobile first marketplace that serves the:

‘I’m moving out, I need to sell/giveaway all my stuff’

-type of user, someone who doesn’t want to list things a week before they need to get rid of it. Facebook marketplace serves some of this crowd, but I don’t think it has, or will have full uptake.

It needs to have:

  • Instant chat function, it needs to be smartphone first,
  • Scrollable feed with all listings (no need to go to a new page),
  • Location based searches,
  • An extensive category system (in my opinion one of Trademe’s greatest assets),
  • Flexible payment options with an ‘offer price feature in chat’,
  • Diversity in monetisation, success fee only is a model for auctions, advertising, high visibility listings, flat fee professional seller rates, and payment protection methods are some of the ways you could monetise a platform like this.

Online auction sites will always have their place, but NZ needs something that is more instant and everyday. Most TradeMe listings go unsold, the majority of sales only receive bids from one person, and then a select few will create a bidding war that truly utilise the sites features. Rather than connecting people to talk to each other and speed up the selling process, TradeMe actively prevents interested buyers from communicating with sellers outside of a simple QnA feature.

TradeMe should remain as the go-to for quality secondhand or collectible stuff, but if you need a new USB cable, homeware item or other daily essential, the kind of listing that rarely receives any bids, there should be another place to go. NZ is severely lacking from all encompassing marketplace similar to Amazon.

Until Amazon arrives and provides everyday new goods for cheap prices, TradeMe will continue to offer the best audience and marketplace for SME retailers to list their items, I just don’t see it as the best use of the platform.




Founder, COO, advisor, writer - Also, husband, outdoor lover, ramen hunter, nerd and runner.