Auction website Sella claims to have grown rapidly in its first year and is near a "tipping point" to take off amid increasing competition for online sales.
The website - a 50:50 joint venture between Herald publisher APN News & Media and entrepreneur Shane Bradley - will not spell out sales or revenue figures.
Bradley says that since its launch in November last year, the auction site now had 10 to 12 per cent of the listings market, dominated by Fairfax Media-owned Trade Me.
Sella had surpassed other auction sites such as Zillion and its forerunner Sell-Me-Free, a discontinued joint venture between APN and ACP Media, he said.
The auction site says it has 125,000 registered members and 120,000 users in each of the past two weeks, due in part to Christmas.
Sella's revenue, which comes only from advertising, will be just a fraction of Trade Me's.
Bradley said that Sella - which emerged from the sale of directory site Finda to Yellow Pages - was keeping with its "free" business plan.
But Sella would consider charges in the future for additional features such as uploading photos.
Bradley claimed that Sella's growth over the past 12 months was due in part to the growing cost of selling small items on Trade Me, after its decision to increase commission from 5.9 per cent to 6.9 per cent.
He said that New Zealand had been dominated by one company and Sella's growth would be healthy for the market.
He said that as an ad-funded service, Sella had taken a cautious approach this year when advertising had slumped across the whole market.
Trade Me chief executive Jon Macdonald said he respected Sella as a competitor but did not see its growth as a trend on a large scale, like the sale of new items on Trade Me - which now makes up 50 per cent of the business.
internet Advertising Bureau chairman Michael Gregg said this year had been a defining one for the domestic online advertising industry.
The industry grew significantly, passing $200 million in spending for the first time, he said,
"Classified spend was hit hardest of the online sectors but has proved its resilience and market strength with a strong Q3/Q4 bounceback."
He said 2010 promised even more growth.
Sella says it's ready to take off
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