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Author Topic: What would you like to see out of vendors?  (Read 1202 times)
Anonymous
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July 14, 2011, 11:27:41 AM
 #1

Good day, Bitcoin forums goers.

I, like many people on these forums, like to consider myself an innovator and businessman. However, most businesses require some initial monetary input. I've seen countless posts here asking for money to start up a business, and I've read business plans from others. But before I even considered posting here, I worked out my plans, spent some of my own money, and actually managed to find a like-minded investor.

One thing I haven't seen, though, is a discussion of what the average Bitcoin user expects out of their vendors. We know what "idea men" expect out of buyers, but to this day I haven't seen a discussion of HOW Bitcoin-based companies should act.

Bitcoin clearly has a future, prices are becoming more stable, services offered are expanding daily, and groupthink has enabled the community to convince smaller retailers to accept Bitcoins. But I'm not talking about what would you like to see sold, or what kind of services offered, but what would you, as the early adopters of Bitcoin that will shape its future, like to see in terms of store layout, how concerns are addressed, business practices, handling of goods or the coins themselves?

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July 14, 2011, 11:50:44 AM
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Not sure if its exactly what you ask for but I for one would like a merchant which accepts Bitcoin and other forms of payment, to reflect the absence of any fees (for the merchant) when paying with Bitcoin.

I've been put off a little when I saw shops which charge you a few percent extra when you pay with Bitcoin (maybe to insure against price volatility). It should be the other way round: offer a 2% discount when customers pay with Bitcoin or charge 2% extra when people want to pay with credit cards for example.

This policy should be clearly visible and made public because hidden costs are likely to annoy people and leave a bad impression.

In connection to that: be open how you calculate your BTC prices! If you have manually set BTC prices, that's fine, if you use the latest price of Mt. Gox, that's fine, if you use some kind of weighted average over time or over different market places, that's fine as well - but _please_ be open about it and clearly state how your prices are set.
Anonymous
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July 14, 2011, 12:18:04 PM
 #3

That's exactly the kind of reply I'm looking for.

I agree a discount for Bitcoin buyers would be good. It might help if more retailers could be convinced of the value of holding on to their bitcoins as an investment. This would work well to slow down cashing out as well, which would help stabilize the value and increase their inherent worth. This could easily be done with smaller businesses selling cheaper products, where holding on to a few sales worth of btc without cashing out wouldn't be such a huge gamble.
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July 14, 2011, 12:27:18 PM
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Programmatically, it is not very hard to incorporate a module into your existing site that will adjust the BTC price in realtime according to the currency you desire.  The Mt. Gox API provides the necessary data in JSON format to make this happen.

If anyone wants this, I can help.

In addition, the fluctuation in price may drive more sales since there will be value built in to the equation.
Anonymous
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July 14, 2011, 12:46:36 PM
 #5

But as long as you're talking about conversion, aren't you basically saying that Bitcoins are worthless without the dollar? (I have another thread about that)
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July 14, 2011, 12:56:15 PM
 #6

As the owner of a (small) venture that accepts bitcoins, I need to point out that after the MtGox hack it's a scary idea to have prices automatically change base on the exchange rate. Say for example the price were to crash back down to 0.01 again, the price on the site would be hugely inflated, and drive away potential buys who might not even know about the change of the exchange rate.

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July 14, 2011, 01:17:44 PM
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But as long as you're talking about conversion, aren't you basically saying that Bitcoins are worthless without the dollar? (I have another thread about that)
Not at all, but since the economy is young, the USD conversion rate is still our best indicator of the perceived worth of 1BTC. That will change in time (as others have pointed out in your other thread)
Anonymous
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July 14, 2011, 01:21:40 PM
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"As others have pointed out" is rather difficult to accept because others have basically made their argument on the basis of underpants gnome logic.
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July 14, 2011, 01:46:29 PM
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But as long as you're talking about conversion, aren't you basically saying that Bitcoins are worthless without the dollar? (I have another thread about that)
Not at all, but since the economy is young, the USD conversion rate is still our best indicator of the perceived worth of 1BTC. That will change in time (as others have pointed out in your other thread)
"As others have pointed out" is rather difficult to accept because others have basically made their argument on the basis of underpants gnome logic.

I just skimmed the other thread and I thought it was rather obvious: the larger the Bitcoin economy grows, the larger the part of the bills you can pay with BTC directly. Therefore merchants are less often forced to convert to other currencies - therefore the conversion rates to other currencies will be less important to determine the "value" of 1 BTC. That's kind of the bootstrapping problem you have with any new currency.

I used to convert all prices to the currency we had before the Euro in my head, back when it was introduced. After a while I got used to getting paid in Euro and paying in Euro - the relation between those two, together with the relative prices of goods and services I bought, made up my new feeling of the worth of 1 EUR. I never convert prices nowadays and since all the prices I have to deal with are in Euro I usually don't care at all for exchange rates to other foreign currencies (like the USD) as well.

Same will happen with BTC if it ever becomes really widespread.

Since a Bitcoin is exactly worth what everybody else thinks it's worth (it has no "intrinsic value", whatever that may be), we just need a measure to quantify this - today the best indicator is the Mt. Gox exchange rate, one day everybody will have a "feeling" what 1 BTC is worth due to many goods and services being priced in BTC. Exchange rates will still exist but will be less important in determining the "real worth" of Bitcoin.
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July 14, 2011, 02:00:27 PM
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If you are paid in euros, it gives you a far easier method of valuing an item - you can always get a rough idea of how much you're paying for something in comparison to the time it takes for you to earn that amount. With bitcoins, the only comparison would be the time it took you to earn those bitcoins though either mining, or by working for the money you used to buy those bitcoins. Neither of these is perfect for valuation of goods (as you say), since bitcoin mining is not really a "job" and the price to convert from your earnings into bitcoins is variable. Until people start being paid in bitcoins (vendors paying themselves through their bitcoin-based business), then valuation is entirely based on speculation - not a good way to sell goods!

With regard to the OP - being able to pay in both bitcoins and other currencies is very important. Factoring in the transaction cost of zero in the bitcoin purchase is also important - take whatever the transaction would cost from a credit card or whatever, and discount this from the price of the product. This will let customers see that there is a benefit of using bitcoins over centralised currency. Finally, the option to pay in a combination of say USB/GBP/EUR and bitcoins would be a good idea. This makes people who have a very small amount able to take part in the bitcoin economy. This may encourage people to get hold of more as they would've spent less using the bitcoins!

Personally, I don't want to faff about with bitcoin exchanges - they're far too much like the wild west at the moment, so the option of paying in part bitcoins and part USD/GBP/EUR would be a good incentive to use the few coins I've gotten through mining, etc.

Hope that helps Smiley

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Anonymous
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July 14, 2011, 02:18:52 PM
 #11

Most credit card companies don't allow you to give discounts for not using credit cards though, it's part of the merchant agreement.
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July 14, 2011, 03:32:13 PM
 #12

Oh yes - I vaguely remember having heard that... Clever move from them...

Would be interesting to actually read such an agreement to check if this restriction also applies if you offer your goods in different currencies. At the very least, they certainly can't force a specific Bitcoin exchange rate upon you, so there might be a loophole there. But you'd probably risk getting your contract canceled Sad

I guess it's time somebody finds a solution to finally loosen the grip of the credit card companies on the merchants... Oh wait, I think we already have Grin

Anyway, there's got to be a way to make it practical for merchants to be upfront with the cost advantages of Bitcoin though - ideas anyone?
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July 14, 2011, 03:38:43 PM
 #13

Most credit card companies don't allow you to give discounts for not using credit cards though, it's part of the merchant agreement.

The actual agreement is that you will not charge extra for the use of a credit card.

BUT you can offer discounts for cash.

My wife's boutique offers 5% off for cash. This is well within the merchant agreement and violates nothing.

The same could be done for Bitcoins.

I will certainly offer 5% off for Bitcoins once I get it implemented on her web page.

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Anonymous
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July 14, 2011, 04:08:18 PM
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Oops, I think you're right! Sorry about that.
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July 14, 2011, 04:10:39 PM
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As the owner of a (small) venture that accepts bitcoins, I need to point out that after the MtGox hack it's a scary idea to have prices automatically change base on the exchange rate. Say for example the price were to crash back down to 0.01 again, the price on the site would be hugely inflated, and drive away potential buys who might not even know about the change of the exchange rate.

I would need to have a fail save built into the code "change <> __% within 1 hour = stop trading in BTC.
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July 14, 2011, 05:21:00 PM
 #16

Good day, Bitcoin forums goers.

I, like many people on these forums, like to consider myself an innovator and businessman. However, most businesses require some initial monetary input. I've seen countless posts here asking for money to start up a business, and I've read business plans from others. But before I even considered posting here, I worked out my plans, spent some of my own money, and actually managed to find a like-minded investor.

One thing I haven't seen, though, is a discussion of what the average Bitcoin user expects out of their vendors. We know what "idea men" expect out of buyers, but to this day I haven't seen a discussion of HOW Bitcoin-based companies should act.

Bitcoin clearly has a future, prices are becoming more stable, services offered are expanding daily, and groupthink has enabled the community to convince smaller retailers to accept Bitcoins. But I'm not talking about what would you like to see sold, or what kind of services offered, but what would you, as the early adopters of Bitcoin that will shape its future, like to see in terms of store layout, how concerns are addressed, business practices, handling of goods or the coins themselves?

-Gilgamesh

"...before I even considered posting here, I worked out my plans, spent some of my own money, and..."

An entrepreneur is apt to be more conscientious when using their own resources involving a new enterprise opposed to receiving VC from a "Forum Buddy". For if/when it fails, they would fault the premiss of the original concept.

"...and groupthink has enabled the community to convince smaller retailers to accept Bitcoins."

A major takeaway from this forum.

Not sure if its exactly what you ask for but I for one would like a merchant which accepts Bitcoin and other forms of payment, to reflect the absence of any fees (for the merchant) when paying with Bitcoin.

I've been put off a little when I saw shops which charge you a few percent extra when you pay with Bitcoin (maybe to insure against price volatility). It should be the other way round: offer a 2% discount when customers pay with Bitcoin or charge 2% extra when people want to pay with credit cards for example.

This policy should be clearly visible and made public because hidden costs are likely to annoy people and leave a bad impression.

In connection to that: be open how you calculate your BTC prices! If you have manually set BTC prices, that's fine, if you use the latest price of Mt. Gox, that's fine, if you use some kind of weighted average over time or over different market places, that's fine as well - but _please_ be open about it and clearly state how your prices are set.

+1

"It should be the other way round: offer a 2% discount when customers pay with Bitcoin..."

With Project X I'm developing, you can throw that 2% discount out the window. I feel a more substantial discount is warranted, treating it like a quasi-lost-leader to build brand awareness.

"...policy should be clearly visible and made public..." Check!

"...be open how you calculate your BTC prices..." Double Check! All my pricing will be in BTC with a conversion drop-down menu to view the current exchange rate of the clients currency of choice.

...
Factoring in the transaction cost of zero in the bitcoin purchase is also important - take whatever the transaction would cost from a credit card or whatever, and discount this from the price of the product. This will let customers see that there is a benefit of using bitcoins over centralised currency.
...

Coupled that with no sale tax (most of the time) for purchasing online, consumers will gravitate toward Bitcoin because they'll recognize the value. TLC didn't add Extreme Couponing to its lineup to just air commercials of their Hoarding: Buried Alive program. It's because their market research indicated there's a large enough demand to warrant the show.

Last night I went to my sister's house to drop off a head of cabbage and smoked butt, expecting her to be engulfed in Farmville. To my surprise, she's now obsessed with couponing to make ends meet, finally realizing that she couldn't REALLY harvest the virtual crops to feed her family. Level 143 allinvain (I think that's supposed to be 3 words).




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July 14, 2011, 05:42:24 PM
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Discount for using BTC.  Cheesy

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July 14, 2011, 09:43:09 PM
 #18

Discount for using BTC.  Cheesy

My main business plan for Project X is "discount for using BTC".



Use Fiat Currency if You Enjoy Paying Full Price
Anonymous
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July 14, 2011, 09:54:42 PM
 #19

Discount for using BTC.  Cheesy

My main business plan for Project X is "discount for using BTC".



Use Fiat Currency if You Enjoy Paying Full Price

BTC is a fiat currency?
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July 15, 2011, 06:33:56 AM
 #20

Discount for using BTC.  Cheesy

My main business plan for Project X is "discount for using BTC".



Use Fiat Currency if You Enjoy Paying Full Price

BTC is a fiat currency?

Let me be perfectly clear. I did not have sex with that chicken!

Oops! Wrong Forum.

Of course, BTC is NOT a fiat currency (hopefully, it never will me). My statement "Use Fiat Currency if You Enjoy Paying Full Price" was meant as a slogan for Bitcoin, in the spirit of this tread's main point--offering a discount if you purchase with Bitcoin oppose to paying full price with any other fiat currency unless you simply enjoy doing such.

Please except my apology if my post wasn't clear. Crystal! (I love that Tom Cruise scene)

Since this tread is probably dead, I'll add a Bitcoin joke (truism) as a tag.

A man tries paying for his drink at the bar with Bitcoin using the app on his Android.
The bartender ask, "Is this a joke?"
Whereupon the man replies, "Yes, if you only trust the US dollar."


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