Second-hand sales the latest online splash
Print Edition
A TINY fish swims in a creek that leads to a bigger pond, where it is joined by others of its kind.
You may think I am talking about a Discovery Channel documentary, but actually it’s part of the marketing for an increasingly popular mobile app in China. Until recently, Xianyu was just one of the many apps competing for my attention. It was only when I decided to sell some unwanted items that I gave it a chance.
Previously a spinoff of e-commerce giant Taobao, Xianyu became an independent operation in 2015 and is gradually evolving into a popular C2C (consumer-to-consumer) marketplace.
As an amateur saxophone player, I own a bunch of accessories like reeds and mouthpieces that were regrettably impulsive buys and ended up sitting idly by in the closet.
With the intention of cashing out some of these unwanted purchases, I put them up on Xianyu, together with three tins of infant formula imported from Australia and diapers suitable for newborns.
I didn’t expect a quick reply, but soon I received an inquiry for a mouthpiece from a young wedding planner and emcee in Wuxi, Jiangsu Province. We quickly agreed on a price. The deal was concluded after he confirmed receiving the purchase I sent him via courier service and payment was transferred to my account from PayPal.
This first successful experience with Xianyu paved the way for more deals. I sold two packs of reeds, several more mouthpieces and a laser distance measurer. Although these items added up to no more than 3,000 yuan (US$432), the ease of trading and my vanity as a small-time vendor brought me back to browsing Xianyu from time to time.
Literally meaning “idle fish,” Xianyu is also a homophone for “salted fish.” The pun here must be intended, since there is a saying in Chinese that goes roughly like, “even a modest thing like a salted fish can hope for better times.” The implied message is that with the help of Xianyu many unwanted items can go to the needy and thus be given a second life.
According to its founder, Xianyu — and similar mobile and online services like 58.com for that matter — represents a budding market worth potentially hundreds of billions of yuan. A study released by China Business News analysts put the market’s value at 400 billion yuan in 2016 — and this was only a “conservative estimate.”
The advent of the market coincides with a proliferation of much-heralded sharing economy schemes such as Uber, Airbnb and the now ubiquitous gray-and-orange Mobikes and yellow ofo bikes that grace Shanghai’s streets.
This is the context in which Xianyu’s operator wants us to see their app. Indeed, a hallmark of our modern consumerist society is that people tend to buy more than they need, and finding ways to put unused goods back into the economy rather than leaving them to gather dust is both a meaningful attempt at reducing waste as well as a much-needed antidote to consumerism.
The ambitions of Alibaba, Xianyu’s parent company, go beyond creating an online flea market for second-hand goods. Its goal is to foster a community made up of “fish ponds,” namely, groups of people with similar interests or who happen to be close geographically.
Personal experience
Ideally, the close-knit nature of these communities engenders better mutual trust required for cash or barter trades, in the same way that Taobao managed to encourage strangers to trade online, something unthinkable two decades ago. Statistics from the company show that there are now upwards of 125,000 “fish ponds” on Xianyu, with “12 per capita interactions registered each day.” What qualifies as an “interaction” though remains unclear.
Alibaba’s goal of bringing strangers together with the social glue provided by its secure payment system is a good exercise in lowering what economists refer to as transaction costs, but it could easily be hobbled by other factors, the most apparent being the lack of social trust.
Since most items up for grabs on Xianyu are categorized as “resale,” an accurate description of their conditions is necessary to avoid disputes. Nonetheless, this could be tricky for secondhand goods, for which trust is in scarcer supply than new products available on Taobao.
For example, I have handled inquiries on Xianyu about my infant formula, with some suggesting that I send photos of the milk froth, taken at required angles (horizontally, vertically, and 45 degrees) to prove it authenticity — authentic formula is said to be frothy. Others insisted on showing them pictures of the courier forms as evidence of my placing an order with an Australian vendor instead of some local e-commerce wholesalers.
To my annoyance, after I took great trouble to supply such materials, the conversation stopped for unknown reasons. Xianyu is also filled with bargain-hunters notorious for their habit of haggling — down to the last kuai.
Yet in spite of all this, a total of 170 million transactions have reportedly been completed as of March, representing a more than a 15-fold increase in the previous 15 months.
Fueled by this expansion, media reported that Xianyu has doubled its staff of late, with operations aggressively stepped up to include forays into uncharted waters like housing rental.
A tiny fish does appear capable of making waves in a bigger pond and adding to the diversity of a Chinese economy in transition.
Well, I have to stop here. There’s a new message on my Xianyu account.
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