eBay = The Fed

OK, that’s a stretch. But via Mediapost we learn that Washington Mutual, a major bank, is using an eBay auction to set interest rates for its CDs. This is a stunt, certainly, but an interesting one. I’ve always been fascinated by the use of eBay as a “meta” pricing mechanism for markets outside of individual items. For example, Dale Dougherty over at O’Reilly recently turned me onto the idea of using eBay to create markets that might predict the half-life/value of new gizmos by comparing what past iterations sell for in aggregate on eBay.

From the story:

In a promotion beginning today, the bank is using eBay to auction interest rates for its certificate of deposit accounts. But instead of posting a low rate and letting consumers bid them higher, Washington Mutual will offer the CDs at a relatively high interest rate, which eBay members will bid down. …. Aside from being a radical form of banking, the promotion is the latest in a series of innovative marketing deals to come out of eBay’s new Strategic Partnerships Unit, which also developed such surprising stunts as Seven-Up’s “Liquid Loot” and Hasbro’s “Jedi Knights” promotions.

More on eBay’s SPU here…