Abstract:
In one aspect, the present disclosure relates to a method for exchanging semi-fungible goods and services. In some embodiments, the method includes electronically receiving from a remote server one or more existing offers, displaying on a screen the existing offers to a participant, and receiving from the participant a selection of an existing offer. In one aspect, the method includes receiving information from the participant related to an offer for an exchange of semi-fungible goods or services and electronically transmitting the offer to the remote server. In some embodiments, the semi-fungible goods or services include tickets, reservations, services, order in line, educational services, or physical objects. In some embodiments, the educational services include a class, a lecture, a lab, or a teacher. In some embodiments, the offer includes parameters comprising date, time, location, loyalty account assets or money.

Description:
CROSS REFERENCES TO RELATED APPLICATIONS 
       [0001]    This application is related to the following application, filed concurrently herewith, the entire contents of which are incorporated herein by reference: 
         [0002]    U.S. Patent Application No. (TBA), filed on May 4, 2012, entitled “Method and System for a Continuous Exchange Driven Reallocation of Semi-Fungible Goods and Services.” 
     
    
     BACKGROUND  
       [0003]    Markets exist for the purpose of exchange, allowing participants to achieve higher states of utility or satisfaction by enabling a reallocation of resources. Some markets do this effectively, resulting in a final state where buyers are closely matched with the products they most desire and sellers generate maximum revenues. Large, liquid public stock exchanges often work this way. During each trading session, buyers and sellers are able to effectively exchange stocks at mutually agreed upon price points. Buyers who most value any given stock are generally able to purchase it from sellers who least value the same stock. Following a successful exchange, both parties have achieved their goals and are better off. 
         [0004]    The simpler the product being exchanged, the easier it is for this type of ideal product reallocation to occur. Consider markets that contain identical products. These products can be more precisely referred to as fungible; that is, all of the products are completely substitutable. For example, there is no practical difference between one ounce of gold and another ounce of gold. Services can also be fungible. For example, the services of a public notary are generally viewed as substitutable for that of any other public notary. 
         [0005]    Markets for fungible products tend to work well due to the certainty about the product being exchanged. Consider the market for gold. The owner of a gold mine does not need to consider the price of each ounce of gold they sell. Likewise, a jewelry manufacturer in the market for gold does not need to decide which mine each individual ounce of gold comes from. The value and price of gold are set by the marketplace itself and is known by all participants. This simplicity makes it easy for buyers and sellers to transact. 
         [0006]    In contrast to markets for fungible products, markets for complex products may result in product allocations that are far from optimal. In such a market, it may be difficult for buyers and sellers to effectively communicate the variety of differences associated with each individual product, and, as a result, buyers may be challenged to find and purchase their preferred product. Some buyers may settle for inferior, but acceptable, products. As a result, sellers will earn less revenue than they otherwise would have. Buyers may also leave the marketplace entirely, resulting in a poor outcome for all parties. These sub-optimal results rarely occur in fungible markets but are commonplace in complex markets. 
         [0007]    One type of complex marketplace is the market for semi-fungible products. Semi-fungible products are goods or services that are somewhat interchangeable but not precisely alike. An example of a semi-fungible market is the market for personal transportation. While all tickets for a seat on an airplane between Washington D.C. and New York may provide the same basic product; namely, transportation between the two cities, the value of a first class ticket may be many times that of a coach ticket. Extending our market definition beyond air transportation, the price of a bus ticket between these two cities may be only a small fraction of the cost of our coach plane seat despite the fact that the same basic service is still being provided. In this type of market, participants frequently may have difficulty identifying and obtaining the product they most desire, resulting in a sub-optimal allocation of products. 
         [0008]    If the participants of a complex market are sufficiently dissatisfied with the initial product allocation, a secondary market may be created. These markets may be organized, or may be spontaneous and informal. In either case, the goal of a secondary market is to identify product reallocation opportunities that were not achieved by the primary market. 
         [0009]    While secondary markets address sub-optimal product allocation, they often face the same challenges as primary markets, and there may be additional challenges that further limit their effectiveness. In some cases, industry-specific technology or governmental regulation require the creation of a formalized market infrastructure. This is the case with air transportation, lodging, and financial instruments. In other cases, secondary markets are easily imbalanced by supply and demand dynamics. A scalper with too many tickets to sell prior to the start of an event is unlikely to spend any significant time buying additional tickets, even if the pricing were extremely favorable. 
         [0010]    Secondary markets may also be inefficient with respect to buyers who wish to exchange their product for one that they find more attractive. To accomplish this, a buyer may often need to participate in two distinct transactions. They must sell the product they originally purchased in the primary market and then buy a product they prefer in the secondary market. This two-step process introduces an additional risk: if a buyer is unable to complete one of the two transactions, they may find themselves with two products instead of one, or with no products at all. 
         [0011]    The prior art identifies a number of inefficiencies that exist in markets for semi-fungible products. Previous attempts at improving these markets can be grouped into three categories: 
         [0012]    1. The enhancement of existing markets through technology 
         [0013]    2. The introduction of new secondary markets 
         [0014]    3. The introduction of new primary markets 
         [0015]    The first category of prior art enhances existing markets by introducing new technology to improve efficiency, speed, and cost. U.S. Pat. No. 6,574,608 to Dahod et al. describes a buyer-driven system of commerce. It improves historical buyer-driven processes such as newspaper want ads by leveraging the efficiency of electronic platforms. However, this approach does not provide for the direct exchange of products between two market participants. U.S. Pat. No. 7,447,655 to Brumfield et al. introduces a methodology for automated short term electronic trading. Brumfield&#39;s concept may increase the potential speed at which participants may engage in trading, but also remains constrained by market transactions which involve only buying or selling a given object. While this first category of prior art may serve to increase market efficiency, it does not directly address the need for a new approach that allows for mutually beneficial product exchanges. 
         [0016]    The second category of prior art introduces new secondary markets that seek to improve upon historical methods. U.S. Pat. No. 8,046,247 to Walker et al. describe a method by which sellers can reclaim and resell their products when demand increases. This approach may increase seller profits, but requires that buyers give up their original right to the purchased product. U.S. Pat. No. 6,067,532 to Gebb describes a method by which purchased products that are no longer desired can be offered up for resale. This approach may create additional value for the buyer who regrets their purchase, but does not address buyers who do not wish to relinquish ownership of their purchased product. U.S. Pat. No. 7,680,726 to Himmelstein describes a method for bartering securities electronically via the creation of potentially tax-advantaged “Himmelstein Options”. This approach may allow for the barter of various financial securities, but does not address the requirements or approach required for the exchange of non-financial semi-fungible products. 
         [0017]    The third category of prior art attempts to improve upon the primary market mechanism. U.S. Pat. No. 7,769,673 to Brett proposes an auction-driven system that generate selling prices theoretically closer to the true market value of each product being sold, thus improving upon the sub-optimal allocation common in complex markets. U.S. Pat.  7 , 908 , 207  to Boyle et al. allows for the aggregation of demand in a reverse auction market, thereby improving the expected outcomes for participating buyers. 
         [0018]    This third category of prior art may improve the functioning of complex primary markets, but, by definition, all post-primary market dynamics are outside the scope of these techniques. Over time, the preferences of market participants may shift and new participants may enter the market. What might be an optimal outcome for a primary market at one point in time may be an extremely poor outcome a short time thereafter. The more dynamic a market, the more value a secondary market may offer. In order to achieve the best possible final result, a continuous reallocation methodology that utilizes a secondary market is required. 
       SUMMARY  
       [0019]    The present disclosure provides methods and systems to overcome the drawbacks to the way in which semi-fungible products are currently allocated via existing markets. This disclosure introduces a continuous secondary market mechanism that allows for the reallocation of semi-fungible products, resulting in an improvement in utility for all parties involved as well as the potential for additional revenues for market makers through transaction fees. 
         [0020]    In one aspect, the present disclosure relates to a method for exchanging semi-fungible goods and services. In some embodiments, the method includes electronically receiving from a remote server one or more existing offers, displaying on a screen the existing offers to the participant, and receiving from the participant a selection of an existing offer. In one aspect, the method includes receiving information from the participant information related to an offer for an exchange of semi-fungible goods or services and electronically transmitting the offer to a remote server. In some embodiments, the semi-fungible goods or services include tickets, reservations, services, order in line, educational services, or physical objects. In some embodiments, the educational services include a class, a lecture, a lab, or a teacher. In some embodiments, the offer includes parameters comprising date, time, location, loyalty account assets or money. 
         [0021]    Another aspect relates to a device for exchanging semi-fungible goods or services. In some embodiments, the device includes a user input module for receiving information from a participant related to an offer for an exchange of semi-fungible goods or services, a communication module for electronically communicating with a remote server to transmit information to a remote server and receive either a matching offer from the remote server or a plurality of existing offers related to the offer, and a display for displaying the matching offer or the plurality of related offers to the participant. In some embodiments, the semi-fungible goods or services include tickets, reservations, services, order in line, educational services, or physical objects. In some embodiments, the information includes parameters related to the offer, wherein the parameters include date, time, location, loyalty account assets or money. In some embodiments, the device includes a phone, a computer, a kiosk, a mobile device, or a content viewer. 
     
    
     
       BRIEF DESCRIPTION OF THE DRAWINGS 
         [0022]      FIG. 1  is a block diagram overview of a system for exchanging semi-fungible goods and services, according to embodiments of the present disclosure. 
           [0023]      FIG. 2  is a flow chart illustrating a method of exchanging semi-fungible goods and services utilized by the processing system shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0024]      FIG. 3A  is a tabular representation of a participant database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0025]      FIG. 3B  is a tabular representation of an inventory database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0026]      FIG. 4  is a flow chart illustrating a method for creating or modifying an offer to exchange semi-fungible goods and services, according to embodiments of the present disclosure. 
           [0027]      FIG. 5  is a flow chart illustrating a method for matching offers to exchange semi-fungible goods and services, according to embodiments of the present disclosure. 
           [0028]      FIG. 6  is a flow chart illustrating a method for executing the exchange of semi-fungible goods and services, according to embodiments of the present disclosure. 
           [0029]      FIG. 7A  is a tabular representation of the participant database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0030]      FIG. 7B  is a tabular representation of the inventory database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0031]      FIG. 7C  is a tabular representation of the offer database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0032]      FIG. 7D  is a tabular representation of the participant database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0033]      FIG. 7E  is a tabular representation of the inventory database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0034]      FIG. 7F  is a tabular representation of the offer database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0035]      FIG. 7G  is a tabular representation of the offer database shown in  FIG. 1 , according to embodiments of the present disclosure. 
           [0036]      FIG. 8A  is a diagram illustrating a two party exchange of semi-fungible goods, according to embodiments of the present disclosure. 
           [0037]      FIG. 8B  is a diagram illustrating a two party exchange of semi-fungible goods, according to embodiments of the present disclosure. 
           [0038]      FIG. 8C  is a diagram illustrating a three party exchange of semi-fungible goods and services, according to embodiments of the present disclosure. 
           [0039]      FIG. 8D  is a diagram illustrating a two party exchange of semi-fungible goods, according to embodiments of the present disclosure. 
           [0040]      FIG. 9  is a tabular example of an exchange of semi-fungible goods between two business entities, according to embodiments of the present disclosure. 
       
    
    
     DETAILED DESCRIPTION 
       [0041]    The present disclosure is directed to systems and methods for a continuous exchange-driven reallocation of semi-fungible goods and services. 
         [0042]    A large number of potential reallocation opportunities are not adequately addressed by secondary markets. Some examples include:
       A) A businessman planning a trip finds he is only able to book an uncomfortable middle seat. He would be willing to pay $200 to get himself a more comfortable aisle seat. At the same time, a price-sensitive student travelling on the same plane has booked an aisle seat. This student is on a tight budget and would gladly exchange seats with the businessman for as little as $50. However, there is no mechanism for these two travelers to interact with each other and execute this potential exchange.   B) A family of four is traveling by express train and finds that their assigned seats are spread far apart. They would be willing to pay up to $100 to have their entire family sit together. There are a number of solo travelers on the same train who would be willing to swap seats for as little as $10. However, all of these travelers are sitting in different parts of the train and are unlikely to find each other either before or during their travels.   C) Two music fans will be attending a concert. One is on the left side of the stage and would prefer to be on the right. One is on the right side of the stage and would prefer to be on the left. They would each be willing to pay some amount to move to their preferred seating location. These two fans could consider using scalpers or resellers to try and obtain their preferred seating locations, but the effort and risk involved with this multi-step process may not be appealing, particularly if little time remains prior to the start of the concert. There is no obvious way for these two fans to find each other and exchange tickets.   D) A manufacturer has a contract to receive a ton of a rare material in January. They actually do not need it until August. A second manufacturer has a contract for a ton of the same material in August but would prefer to receive it in January. Both manufacturers would benefit from trading their advance orders but there is no market for such a transaction. The supplier may have the capability to broker such an exchange but may have little incentive to do so.       
 
         [0047]    To address shortcomings in the prior art, the present disclosure introduces a system that allows a plurality of market participants to exchange semi-fungible products. There are four benefits resulting from the creation of this exchange:
       1. Exchange participants can upgrade aspects of their product that they value more.   2. Exchange participants can monetize aspects of their product that they value less.   3. Market efficiency may be improved, particularly when supply and demand disruptions limit normal market liquidity.   4. Market makers may generate additional revenues through transaction fees.       
 
         [0052]    Exploring each of these benefits in turn, let us first examine the case where a market participant wishes to upgrade some aspect of their current product. This type of participant has purchased a product that they value, but they are not fully satisfied with their purchase. Consider the business traveler who has purchased a middle seat on a plane. As a price-insensitive business traveler, he may be willing to pay significantly more for a more comfortable aisle seat, but was unable to obtain one in the primary market. By enabling this traveler to exchange his seat for one that he values more, his overall satisfaction can be increased. 
         [0053]    Product upgrades can encompass more than one dimension. Our business traveler may be willing to adjust several aspects of his purchased product to realize the best possible outcome. In order to achieve his primary objective of travelling in a more comfortable manner, he may be willing to fly earlier in the day, utilize a different transportation provider, arrive at a different airport, or even exchange his seat for an alternative form of transport such as express train or limousine service. 
         [0054]    When compensation is involved in an exchange, it need not be limited to currency. While our business traveler may wish to directly bundle a certain amount of money with his middle seat to secure a product upgrade, he is free to offer any asset capable of being managed in an electronic environment. Potential alternative assets include loyalty points, airline miles, reward certificates, upgrade points, and financial instruments, all of which are routinely managed in secure modern electronic environments. 
         [0055]    Now, consider market participants who wish to monetize certain aspects of their product. They realize that while they may not see any meaningful difference between two products, other participants may value the market differently and may be willing to pay for an exchange with them. As an example, consider a traveler sitting by herself on a train. She may see no difference between her window seat and any other window seat on the same train. However, a family looking to rearrange their seat tickets so that they can sit together may be willing to pay her $10 just to move a few rows. By participating in such a transaction, our indifferent traveler has monetized the value of her ticket without compromising the value she receives from the product. 
         [0056]    Monetization does not require indifference to a proposed product exchange. An exchange can easily involve a perceived product downgrade as long as the compensation from the other party exceeds the perceived loss in value. Consider our train passenger once again, but now assume that the family looking to sit together would like our passenger accept a less desirable seat next to the restroom entrance. Our passenger may no longer find $10 sufficient inducement to participate in an exchange. However, there is likely some price at which our passenger would be willing to exchange her seat and feel better off than she did prior to the exchange. 
         [0057]    In addition to creating value for market participants, the present disclosure may also benefit the functioning of the overall market by providing additional liquidity to all market participants. This effect may be most pronounced during supply or demand fluctuations, when the primary market is challenges to match buyers and sellers in the traditional manner. 
         [0058]    To illustrate this phenomenon, consider a typical supply disruption in the airline industry: inclement winter weather in Chicago disrupts the normal hub-and-spoke airline networks, resulting in nationwide flight delays and a high risk of flight cancellations. In such an event, individual traveler preferences may drastically shift at the same time that market liquidity is restricted, creating an imbalanced market that may take several days and large sums of money to correct. Prior to the network disruption, a given individual may be perfectly satisfied with his ticket on an 8 PM flight from Chicago to Orlando. However, once weather issues begin early in the day, this passenger realized his late flight may be cancelled. Immediately, this passenger&#39;s preference set radically shifts: he is planning to attend an important event the next morning and may be willing to pay up to $1,500 in order to exchange his seat with someone leaving earlier in the day on flight less likely to be cancelled. If a passenger on the earlier flight is willing to accept this exchange, not only will both passengers be better off, but the burden on the network may be reduced since fewer passengers may require the attention of airport employees and the total system cost for rebalancing the system could be reduced. By introducing additional liquidity into a restricted system, the necessary product reallocation may be achieved more easily and efficiently. 
         [0059]    Likewise, fluctuations in demand that drive limited market liquidity may also benefit from the present disclosure. Consider the market for a new consumer electronics product. It is not uncommon for demand on this type of product to quickly spike, far outpacing the manufacturer&#39;s ability to supply the product to the marketplace. As a result, consumers not able to purchase the product may receive vouchers that are fulfilled in sequential order. These vouchers are semi-fungible products. While all vouchers assure receipt of the desired electronic product at some point in time, the actual date of receipt will vary by voucher. Since there may be no relationship between any individual&#39;s desire for the product and the order of their voucher, an opportunity for product reallocation exists. A secondary market would allow consumers who most value early receipt of the product to pay for this right and receive the product first, while others could monetize the value of their early vouchers and receive the product at a later time. 
         [0060]    A market that regularly suffers from a lack of liquidity may also benefit from the present disclosure. Consider the market for educational services, for example, classes at a college or university. At the start of each semester, students may vie for limited spots in any number of popular classes. As a result, when classes reach capacity, some students may find that they are not able to construct their preferred class schedule and need to enroll in classes that they otherwise would not want to take. However, at the same time, some of the students that were able to obtain spots in popular classes may actually be indifferent between taking that class and one of the less popular alternatives. These two groups of students could benefit from a secondary market that allows for product reallocation. Students that most value a certain class could exchange parts of their schedule with students that value these classes to a lesser degree. As with other markets, both individuals could potentially benefit from this exchange. 
         [0061]    A final benefit arising from the exchange of semi-fungible products is the potential for creating a profitable market infrastructure. Requiring reasonable transaction fees for product exchanges is consistent with the way in which many markets function and reflects the real value created by the marketplace. Transaction fees may be charged to the buyer, to the seller, or both. Such fees may be flat, variable or a combination of both a flat and variable fee. 
       System Architecture 
       [0062]    Turning to the drawings,  FIG. 1  provides an overview of the system architecture. The system includes a number of participant devices  100  which allow interested parties to connect to the processing system  110 . The participant devices may be personal computers, cell phones, mobile devices, kiosks, or any other types of communication device capable of receiving and transmitting data. The participant device does not need to be physical. It may be a virtual device, a computer program, a service offered by a website, an application run on a mobile device, or any other type of system capable of receiving and transmitting data. The processing system  110  may be a dedicated physical computer, a cloud-based virtual system, or another form of computational processor. The participant devices  100  may connect to the processing system  110  through a wireless connection, a direct wired connection, the internet using TCP/IP, a Local Area Network (LAN), a virtual private network (VPN) or any other form of communications network. 
         [0063]    The processing system  110 , in turn, connects to a number of data sources. These include an offer database  120 , an inventory database  130 , and a participant database  140 . 
         [0064]    These three databases may reside on the hard drive or memory of a physical server, a virtual server, a distributed computing platform, a network of computing devices spanning both dedicated servers and mobile devices, or any other form of technology capable of storing and retrieving data. These platforms can incorporate a database management systems (DBMS) to manage the databases in a structured fashion. 
         [0065]    These databases may be structured as relational databases, parallel databases, cloud databases, data warehouses, federated databases, in-memory databases, flat files, or any other data structure that meets the needs of the particular application. 
         [0066]    The offer database  120  contains information used to structure participant offers. These offers are composed of one or more product criteria, a compensation element, user preferences, and a link to the appropriate product in the inventory database  130 . Together, these pieces of information allow the processing system  110  to identify which other offers represent potential matches. The offer database may be directly accessible by participants who wish to manually search for matching offers. 
         [0067]    The inventory database  130  contains information about the products that are being offered for exchange by participants. This can include ownership information as well as all of the data upon which offers are created. Due to the fact that multiple offers may exist in the offer database  120  for each product in the inventory database  130 , this database may follow standard, well-understood conventions that prevent a single product from being acted upon by more than one offer at a time. 
         [0068]    Finally, the participant database  140  contains information on each market participant. This data may include elements associated with an individual participant such as name, address, billing information, security data and preferences for interacting with the processing system  110 . A single market participant may be associated with any number of products and any number of offers. Sensitive data such as credit card numbers or passwords may be stored using established database encryption techniques. 
         [0069]    In practice, it may be preferable to combine or sub-divide these databases in any number of ways to increase processing efficiency, data validity, data security or ease of maintenance. By way of example, all three databases  120 ,  130 ,  140  may be contained within the memory of the processing system  110 , allowing for increased speed and efficiency. Alternatively, the databases may be further subdivided by geography, participant type, product type or some other characteristic that improves the overall performance, reliability, security, maintenance or general functioning of the system. In the case of mobile or distributed computing, it is feasible that millions of mobile devices may contain their own database that interacts with the processing system  110 , and that certain functions of the processing system  110  itself may be partially or fully executed by mobile, remote or distributed devices. 
       Detailed Process 
       [0070]      FIG. 2  describes the exchange process. As a precondition, a participant must possess or have some ownership right to one or more suitable semi-fungible goods, services or priority rights, referred to hereafter as “products”. Up until the product is used, consumed, sold or otherwise unavailable for exchange, a participant may enter the system  200  and create any number of offers  220 . Potential matches may then be identified  240  by either the participants or the processing system  110 . If a potential match is approved by all involved participants, the processing system  110  can execute a product exchange  260 . 
         [0071]    A participant enters the system  200  when they believe a potential exchange may be of benefit to them. For example, a family purchasing three airline tickets may find that their seats are too far away from each other and that there would be value in modifying one or more of their purchased tickets in order to have the family sit closer together. Conversely, another airline passenger may be completely indifferent in regards to the location of their seat and would be willing to exchange seats in return for some form of compensation. 
         [0072]    The way in which a participant enters the system  200  can vary with the technology being utilized and the nature of the products being exchanged. One natural point of entry involves integration with the platform used to purchase the products being exchanged. For example, a website, mobile application, or kiosk that sells event tickets could allow users to enter the exchange system. This structure has the advantage of being directly connected to the system-of-record for the purchased products, thereby reducing the potential for fraud and simplifying the final systems architecture. 
         [0073]    An alternative and equally acceptable way to enter the system  200  may involve an independent technology platform separate from any platform used to purchase the products being exchanged. This structure has the advantage of additional flexibility in terms of the breadth of products that may be exchanged. By existing as a system-independent platform, participants may be able to consider complex multi-product exchanges that offer additional value. 
         [0074]    Information about both the participant and the product may be collected during this stage  200  and stored in the participant  140  and inventory  130  databases, respectively. Certain information may also be validated at this time to minimize the potential for later issues. For example, participant identification and product ownership may be confirmed by communicating with external data sources or by other means. 
         [0075]    After the system is entered, a participant may then create an offer  220  based on one or more of their products. The offer creation process translates what a participant wants out of a potential exchange into structured data that can be stored in the offer database  120  and used by the processing system  110  and the participants themselves to identify potential matches. During this process, the participant may also be able to view current or historical offer data. In some cases, this may lead the participant to identify an offer they wish to immediately accept. If this occurs, the process may move directly to the product exchange process  260 . 
         [0076]    The matching process  240  provides for the identification and processing of potential offer matches. These potential matches may have been previously identified by the participants themselves during the offer creation process  220 , or the system may review all existing offers to find potential matches. In either case, once a potential match is identified and agreed to by all participants, the system can then proceed to execute a product exchange  260 . If no matches are found, the system can wait until a new matching offer is created by a participant, an existing order is modified in a way that allows it to match, a participant opts to directly accept an offer, the offer is cancelled or the product that the offer is based upon is no longer available for exchange. 
         [0077]    The offer exchange process  260  begins when two or more offers are matched either by the processing system  110  or directly by participants. At this time, any required compensation processing takes place and the product exchange is accomplished by updating systems that record official ownership of the products involved. Once all systems of record have been updated, participants are notified and the exchange is complete. 
         [0078]      FIGS. 3A and 3B  illustrate exemplary types of data that may be stored in the participant database  140  and inventory database  130  after an individual has entered the system  200 . The precise type and quantity of data can be specific to each product market, but may include data related to individual and product identification, security, participant preferences, and product attribute fields used during the offer matching process. 
         [0079]    The sample participant database  140  shown in  FIG. 3A  illustrates a potential subset of fields that may be used to manage a participant&#39;s data. Many databases structures may assign a unique identification number  300  to each participant. Data used by the exchange process can include an individual&#39;s first name  301 , last name  302 , address  303 , and credit card number  304 . Other potential participant data includes e-mail addresses, login identifiers, login passwords, and login security questions. Ideally, any data deemed sensitive (such as credit card numbers, passwords, and security information) can be stored in a secure, encrypted manner. Non-sensitive participant data may also be used for marketing purposes. 
         [0080]    The inventory database  130  shown in  FIG. 3B  illustrates a potential subset of fields that may be used to manage the data surrounding an individual product. A unique product identifier  310  may be used to uniquely identify each product in the system. An owner identifier  311  associated each product with its owner in the participant database  140 . An expiration date  312  is used to limit the timeframe of an offer. This time or date may be determined by the product itself, such as the departure date associated with an airline ticket, or it may be an arbitrary date created by a participant. For example, a participant may not want to exchange her product after a certain amount of time in order to prevent last-minute changes to her travel schedule or other plans associated with the product. 
         [0081]    The inventory database  130  can also contain a number of attribute fields that allow for the construction of detailed offers. In  FIG. 3B , our sample inventory database, our first attribute field  313  describes the position of an airline seat: aisle, middle, or window. The second attribute field  314  describes the row number of an airline seat. Other potential attribute fields associated with an airline seat may include carrier, date of departure, originating airport, destination airport, and exit row status among others. Potential fields for a live event at a music venue may include the performing artist&#39;s name, the date of the event, the section number, and the row number, among others. Potential fields for other semi-fungible products will vary and are only limited by the nature of the product and the perceptive ability of involved participants. 
         [0082]    When product data is added to the inventory database  130 , some level of verification may take place to ensure that the product in question is actually owned by the participant. This verification may require explicit communication between the processing system  110  and an external system. This verification may be implicit if the product inventory data is being directly transferred by a previously verified and authorized system. 
         [0083]      FIG. 4  provides more detail on the offer creation process  220  from  FIG. 2 . At the start of the offer creation process, a participant may have the opportunity to view offers created by other participants  400 . Collectively, these offers can be referred to as the “market” or a “marketplace”. In certain embodiments, a participant may have complete visibility to all offers, while in other embodiments only a partial view may be available for reasons specific to that marketplace. In still other embodiments, participants may have access to historical data which may further enhance their ability to create effective offers. 
         [0084]    Data helpful to a participant may include current bid and ask offers for similar products, recent volume of transactions in the product category, or historical trends in terms of both price and volume. To illustrate this, consider a music fan looking to monetize the value of their front-row concert ticket. This individual may find it helpful to know what value was attached to similar offers in the past, what bid values currently exist in the market, and if any other ask offers exist. If the participant sees that many concert goers are willing to offer more than $100 in order to exchange their less desirable tickets for his front-row location, our music fan may feel more inclined to create a new offer with an ask price well above $100. 
         [0085]    Normally, it is to the participant&#39;s advantage to gain as much information as possible before creating an offer. There are several reasons for this. First, the participant can develop a more effective offer by evaluating current market conditions. He may find that there are already several offers that potentially match his product&#39;s attributes, but that his initial ask value is simply too high. Second, there may be offers in the marketplace that the participant may want to immediately accept, allowing him to avoid the time and effort associated with creating a new offer. 
         [0086]    If a participant identifies an existing offer that he would like to accept, he may do so immediately  405 , without the need to create an offer of his own. The system may automatically create a matching offer in the offer database  120 , or may allow the process to proceed in an efficient manner with all of the information required to execute a product exchange, but without creating a matching offer in the offer database  120 . In either case, if an existing offer is identified as a potential match by a participant, the process may immediately proceed to the matching process  240 . 
         [0087]    If the participant does not identify an existing offer that he wishes to accept, he may then proceed to create one or more new offers, or to modify an offer he previously created. The offer creation/modification process  430  allows participants to translate their intentions into a structured form of data that can be used by the processing system to identify potential matches. This process involves three steps. These steps can be completed in any order and may be predetermined by the market maker. 
         [0088]    First, the criteria for an acceptable product exchange are selected  415 . Consider, for example, an airline passenger with a preference for aisle seating who has unfortunately purchased a window seat. This passenger may be willing to exchange his current (window) seat for any aisle seat on the same flight. If the individual is more discerning, he may only be willing to exchange his current seat for an aisle seat in rows  8 - 15 . On the other hand, if the individual has a particularly strong aversion to window seats, he may be willing to broaden his selection criteria to include aisle seats on flights other than his own. An individual&#39;s set of personal preferences define what type of product is acceptable on the other side of the exchange. 
         [0089]    If the product being exchanged consists of a block of several individual items, the criteria for an acceptable exchange may include metrics that are relative in nature. In the case of a block of four event tickets, a participant may want to exchange this block only for another block of tickets that are physically next to each other. In this example, the desired seat location is relative to the other seats, not to the event venue itself. It is also possible that both relative and absolute criteria exist. For example, a participant exchanging a block of seats may desire that all seats are both next to each other and are all located in a specific location, such as on the mezzanine level. 
         [0090]    The second step in the offer creation/modification process involves determining what form of compensation  420 , if any, is included in the offer. There are three possibilities: a bid, an ask, or an even exchange. A bid offer means that the participant is willing to compensate the party on the other side of the product exchange. This implies that the participant is attempting to upgrade their product along one or more dimensions. 
         [0091]    An ask offer means that the participant wants to receive compensation in order to accept an exchange. This may or may not involve a perceived product downgrade. 
         [0092]    Finally, an even exchange does not involve any transfer of compensation and implies that all parties involved in an exchange possess complementary preference sets. For example, one participant may prefer aisle seats while another prefers window seats. In an even exchange, the simple act of exchanging products produces value for both participants. 
         [0093]    The third step in the offer creation/modification process allows participants to select the degree to which they will be involved in the exchange process  425 . In certain embodiments, this step may be fixed in advance or may be dictated by the nature of the market. The spectrum of involvement ranges from a completely manual process where participants review each and every potential match before the process moves forward, to a fully automated process where no participant input is required and offers are automatically reviewed and matched by the processing system  110 . 
         [0094]    A manual, participant driven review process may be preferred where the set of potential options is large and participant preferences are dynamic. For example, consider a participant looking to exchange a train reservation for a similar reservation sometime later that year. Considering that the number of potential transit-date-time combinations may be extremely large and that the participant&#39;s schedule may change over time, it may be unrealistic to try and provide a comprehensive set of preference information. In such a situation, it may be more efficient for participants to provide a limited set of criteria and then to manually review potential matches as they are identified by the processing system  110 . 
         [0095]    An automatic, system driven review process may be preferred where the set of potential options is limited and participant preferences are relatively stable over time. For example, an airline passenger looking to exchange their middle seat for an aisle or window location on the same flight may not benefit from reviewing each potential matching offer. Due to the superior speed associated with an automated review process, this approach also gives a participant the best possible chance of securing a match quickly. Consider two participants with identical preferences and identical products. If one participant agrees to an automatic review process and the other participant opts to manually review each and every potential match, the automatic process should be expected to obtain a desired match first. 
         [0096]    Additionally, an automatic, system driven review process allows for multiple party exchanges that may not be practical or even possible with a manual review system. 
         [0097]    In practice, a participant may choose to take advantage of both automated and manual review processes by creating multiple offers. Automatic, system driven offers can identify clearly favorable circumstances that do not require further review by the participant. At the same time, manual offers may capture a wider spectrum of potential matches that will require further consideration before being accepted. 
         [0098]    Following the acceptance, creation, or modification of an offer  430 , the matching process  240  begins. This process is detailed in  FIG. 5 . The search for potentially matching offers  500  may be accomplished by either the system or by individual participants. A system search is initiated when changes are made to either the offer database  120  or inventory database  130 . The processing system  110  compares offer requirements contained in the offer database  120  to product data contained in the inventory database  130 . When the criteria for two or more offers and their associated products are fully satisfied, a potential match has been found  505 . At this time the offer database  120  and inventory database  130  may be updated to reflect that a potential match has been identified. 
         [0099]    As an alternative to a system match, individual participants may identify and accept existing offers without creating offers of their own. Acceptance of an existing offer  405  creates an implicit match  505  between two or more offers. 
         [0100]    If no potential matches are identified by either the system or participants, the system can continue to search for new potential matches every time a change occurs in either the offer database  120  or the inventory database  130 . During this time, participants may continue to interact with the market by creating new offers, modifying or deleting offers they have previously created, or accepting offers created by other participants. 
         [0101]    The amount of time available for any particular product exchange may be defined by the nature of the product, the market maker, or the participants involved. For example, sporting events, airline tickets, hotel rooms and music concerts are all associated with a specific time, and exchanges can not occur once the time associated with these products has past. Additionally, for certain products, some time buffer may be required for final product processing, preparation or customer service and so the available processing window for the exchange may be less than the theoretical maximum. In other cases, the market maker may wish to artificially limit the amount of time available for product exchanges in order to constrain market volume, support customer service or to limit exchange activity in a specific way. Finally, the participants themselves may desire to limit the amount of time that their products are available for exchange. 
         [0102]    When a potential match is found  505 , participant preferences regarding system interaction are checked. These preferences were either previously selected by participants  425  during the offer creation process  430  or may have been fixed by the system at a market level. 
         [0103]    If all participants involved in a potential match have opted to allow the system to process their potential matches, no further participant action is required. The system will recognize that all participants implicitly accept the potential match  520 , and will proceed with executing the exchange  260 . 
         [0104]    When one or more participants involved in a potential match have selected manual processing, participant interaction is required  525 . In this case, each participant will need to review and approve the potential match. When any given participant accepts the potential match, the system can record this approval and continue to collect participant approvals until all participants have approved the match  520 . Once all participants have approved of the potential match, the exchange can be executed  260 . However, if any participant rejects the potential match, the match process can be cancelled  515 . 
         [0105]    In certain embodiments, a participant may be allowed to propose a counteroffer when an potentially matching offer is declined  530 , creating a new potentially matching offer cycle. For example, consider a participant who is looking to exchange his premium concert ticket for another of lesser quality for $ 50 . It is possible that he rejects a potential match due to the extremely poor quality of the other ticket. In response, the owner of the second ticket may choose to create an immediate counter-offer, raising the compensation level to $ 100 . This new offer would represent another potential match  505 , and a new potential offer cycle could begin. 
         [0106]    If a potential match is cancelled  515  by a participant and no counteroffers are created, the system may return to searching for potential matches  500 . 
         [0107]      FIG. 6  provides more detail on the execution of an exchange  260  from  FIG. 2 . At the start of the exchange execution process, all involved products are locked  600 , preventing the execution of any competing offers until the offer set under consideration is either executed or cancelled. Any number of well-understood methods may be used for locking products in the inventory database  130  in order to prevent interference from other active processes. 
         [0108]    Compensation processing  610  follows, where funds and/or other assets are debited and credited as necessary in participant accounts. It is possible that errors may occur  620  during this process. For example, the systems that control a participant&#39;s assets may be temporarily unavailable or report that insufficient funds exist to cover the requested transaction. 
         [0109]    If errors are identified  630 , the exchange process may be delayed or cancelled. Any partially completed compensation transfers can be rolled back, involved participants can be notified of the cancellation, and participant product inventory may be unlocked to immediately allow for additional potential matches. 
         [0110]    Depending upon the nature of the error received, a number of additional actions may take place. If the error is temporary in nature; for example, if a certain external system is temporarily unavailable, the impacted product may be held in a locked state until the error is resolved. If the error is related to a potential fraud or security problem, all products linked to the participant&#39;s account may be locked until the issue is resolved. This process may involve updating the participant database  140  with additional information regarding the errors received. 
         [0111]    Following successful compensation processing, the remaining internal and external systems may be updated  630  to complete the exchange process. These include systems-of-record, the official repositories of electronic product ownership. Systems-of-record may include proprietary databases, airline, cruise and hotel computer reservation systems, or any other database or computer used to electronically record, in an official manner, ownership of the involved products. 
         [0112]    Error checking  650  is also performed at this stage. It is possible that certain systems may be unavailable or may report data discrepancies. For example, an external system-of-record may report that one participant no longer retains ownership of a product in question. If any errors are found, appropriate error processing  630  takes place. 
         [0113]    Differences in system architectures may dictate that compensation processing  610  and system updates  640  take place in reverse order or simultaneously. 
         [0114]    Once compensation processing  610  and system updates  640  are completed without errors, the exchange is completed  660 . This final step may involve participant notification and any necessary data maintenance, logging and archiving. Participant notification may include any additional information necessary for participants to successfully claim or utilize their new product(s) and/or compensation. It is not necessary that all system activities fully complete prior to participants claiming their products and compensation; certain tasks related to maintenance, record keeping or other low priority tasks may be performed at a later time. 
       Illustration of Offer Process: Single Participant Creating Single Offer 
       [0115]    Consider a student who purchases an airline ticket for $700 to fly from New York to London. The ticket is purchased far in advance of the actual departure date and represents a good value for our price-sensitive student. Our student also happens to be fairly flexible in her travel plans, and doesn&#39;t mind altering her plans in order to recoup some of the cost involved. As a result, our student decides to participant in the exchange process. 
         [0116]    Our student enters the system  200  through an application on her cell phone  100 , and reviews the current market for her ticket  400 . She is not surprised to learn that there are no offers on her flight; after all, her ticket has been booked well in advance and it&#39;s likely that only a small number of seats have been sold by the airline. However, she also learns that on similar flights in the past, many successful exchanges have taken place, and that in the week prior to departure, exchanges have involved compensation exceeding $300. 
         [0117]    Since there are no existing offers for our student to consider  405 , she opts to create one of her own. Her participant data was previously collected and stored in the participant database  140  when she registered using her cell phone application. 
         [0118]      FIGS. 7A ,  7 B and  7 C describe a potential subset of data associated with our student&#39;s offer.  FIG. 7A  represents potential contents of the participant database  140 ,  FIG. 7B  represents potential contents of the inventory database  130 , and  FIG. 7C  represents potential contents of the offer database  140 . 
         [0119]    In  FIG. 7A  we see the portion of the participant database  140  that includes her participant ID number  701 , first name  702 , last name  703 , her type of compensation account  704 , her encoded compensation account number  705 , her airline frequent flier program  706 , her encoded frequent flier account number  707 , her e-mail address  708  and her securely encoded password  709 . 
         [0120]    Her product data is transferred directly from her airline&#39;s reservation system to the inventory database  130 . In  FIG. 7B  we see the portion of the inventory database  130  that includes her seat position  711 , seat row  712 , carrier  713 , flight origin  714 , flight destination  715 , departure date  716 , flight number  717 , and the system-of-record  718  that maintains the official, formal record of her product ownership. 
         [0121]    Our student proceeds to select the criteria for her desired exchange  415 . She is willing to accept a wide range of products in a potential exchange. She&#39;s willing to sit in any type of seat, in any row. She&#39;s willing to travel on a different airline and leave any time of day. She&#39;s also willing to leave from either of two New York airports (JFK or LaGuardia), and is even willing to alter her departure date by a few days. 
         [0122]    In return, our student determines that she would like compensation  420  of $150. This is represented by an ask offer. Finally, our student selects her preferences for interacting with the system  425 . She opts to allow for automatic processing of her offer, given that she is relatively indifferent to the possible exchanges that meet her criteria. 
         [0123]    In  FIG. 7C  we see the portion of the offer database  120  that includes her offer criteria. These criteria include seat position  721 , seat row  722 , carrier  723 , origin  724 , destination  725 , departure date  726 , flight number  727 , and exit row seating  728 . It also contains her $150 ask offer  730  and no bid offer  729 . Finally, it also contains her preference for automatic match processing  731 . 
         [0124]    Time passes. Two weeks prior to our student&#39;s departure, a family books three tickets on the same flight. They are disappointed to find that they are unable to sit together. After purchasing three seats in three different areas of the plane, they enter the exchange system  200  through their home computer  100 . Viewing existing offers  400 , they do not immediately identify a match and so they allow the system to find a potential match for them. This involves creating an offer  430  that specifies they are looking for a group of three seats next to each other. They are willing to pay $300 for the total exchange and opt to allow the system to execute any matching offers automatically. 
         [0125]    After the family creates their offer, the system begins the match search process  500  by looking for all possible combinations of offers that provide the family with a set of three contiguous seats. It finds a match  505  by combining our student&#39;s offer with two other participant offers. The combined ask price for these three seats is $280: $150 from our student, $100 from a second offer, and $30 from a third offer. 
         [0126]    All four involved participants opted to allow for automatic processing. This allows the system to infer approval from all parties  520  and allows the system to begin the exchange process  260 . 
         [0127]    The six tickets (three from the family, one from our student and two from two other participants) associated with this exchange are locked  600 , preventing interference from any other active offers. During the brief period of time it will take the system to process the exchange, it will not be possible for any additional action to be taken on these specific products. The compensation processing  610  occurs without errors  620 . 
         [0128]    All systems-of-record are updated  640  without errors  650 . In the case of our student, her system-of-record is her airline&#39;s computer reservation system (CRS). In order to process the compensation transfer required of this exchange, the family&#39;s credit card is debited for $280, our student&#39;s PayPal account is credited for $150, and the other two participant accounts are credited for $100 and $30. After this process is complete, all four participants receive confirmation  660  that the exchange has been successfully completed. 
       Illustration of Offer Process: Single Participant Creating Multiple Offers 
       [0129]    To illustrate the creation of multiple offers on a single product, consider a business traveler who purchases an airline ticket for $995 to fly from San Francisco to New York. Our traveler likes to work during long flights and is disappointed he isn&#39;t able to use his frequent flier status to upgrade to first class. Instead, his ticket is for a middle seat. He knows that he might be able to change his seat when he checks-in at the airport, but would prefer to obtain an aisle seat in advance in order to completely eliminate the risk of having to spend five hours in a middle seat. Our traveler also has an abundance of frequent flier miles, and wouldn&#39;t mind giving up a few of them in order to obtain a guaranteed aisle seat. 
         [0130]    However, our traveler also knows from experience that this particular flight is often sold out and many other business travelers are forced to take a much less convenient flight either earlier or later in the day. Someone in this situation may be willing to pay a substantial sum in order to exchange tickets with him. For the right price, our traveler is willing to sacrifice the convenience of his current flight. 
         [0131]    Our business traveler enters the system  200  through his airline&#39;s frequent flier website  100  and views the current market for flights between San Francisco and New York  400 . He does not have the time to review existing offers  405  and decides to simply create two new offers  430 . 
         [0132]    All of our traveler&#39;s data was previously either entered by him when he first registered with the exchange system or collected and transferred by his airline&#39;s reservation system, so he does not need to enter any additional information at this time. 
         [0133]      FIG. 7D  illustrates the portion of the participant database  140  that contains our traveler&#39;s identification number  741 , first name  742 , last name  743 , type of compensation account  744 , encoded compensation account number  745 , airline frequent flier program  746 , encoded frequent flier account number  747 , e-mail address  748  and encoded password  749 . 
         [0134]      FIG. 7E  illustrates the portion of the inventory database  130  that contains information about our traveler&#39;s product. It includes his seat position  751 , seat row  752 , carrier  753 , flight origin  754 , flight destination  755 , departure date  756 , flight number  757 , and the system-of-record  758  that maintains the official, formal record of his ownership of this product. 
         [0135]    The first offer that our traveler creates is focused on exchanging his middle seat for an aisle seat. For his exchange criteria  415 , he is not willing to fly on any other airline, since that might risk his opportunity for a first class upgrade. In terms of compensation  420 , he&#39;s willing to give up  2 , 500  frequent flier miles for this exchange. In order to maximize the probability that this offer is identified and processed quickly, he opts for automatic processing  425 . 
         [0136]    In  FIG. 7F  we see the portion of the offer database  120  that contains the data related to this first offer. It includes his criteria for seat position  761 , carrier  762 , flight number  763 , departure date  764  and his  2 , 500  mile bid offer  765 . It also contains his preference for automatic match processing  767 . 
         [0137]    Our business traveler also creates a second offer in order to monetize the value of his current seat. For this offer, his exchange criteria  415  still requires that he remain on the same airline, but provides flexibility in terms of departure time and seating location. He is willing to leave either earlier or later in the day and is willing to accept either an aisle or window seat. He asks $700 for this exchange  420 . He doesn&#39;t specify any other criteria, and chooses to manually review  425  any matching offers. 
         [0138]    In  FIG. 7G  we see the portion of the offer database  120  that contains the data related to the second offer. It includes his criteria for seat position  771 , carrier  772 , flight time  773 , departure date  774  and $700 ask offer  775 . It also contains his preference for manual match processing  776 . 
         [0139]    As our business traveler enters his two offers, the system begins to search for potential matches  500  but does not find any. It continues to search for matches as new offers are added to the market and existing offers are modified. 
         [0140]    After a few hours, another business traveler on a later flight to New York enters the system  200  and sees our business traveler&#39;s second offer  400 . This traveler likes the idea of taking a more convenient flight and decides to accept this offer  405 . 
         [0141]    Because our first traveler opted to manually review potential matches on this offer, he receives an alert on his smart phone  100  that a potential match exists. He enters the system  200  through his smart phone  100  and reviews the latest marketplace data  400  which includes information regarding the potential match. He sees that the seat being offered to him is towards the back of the plane and is an aisle seat. After considering this offer, he decides to accept  405 . 
         [0142]    The system recognizes that the search process  500  and match identification process  505  are both complete and that all involved participants have accepted the potential match  520 . The exchange process is initiated by locking the two involved tickets  600  in the inventory database  130 , preventing any additional activity from taking place. 
         [0143]    Compensation processing  610  takes place. Our traveler&#39;s Visa account is credited for $700 as the second participant&#39;s account is debited for $700. No errors occur  620 , and the systems-of-record associated with each product are updated  640 . For our traveler, his airline reservation system is updated with the new ticket data. Again, no issues or errors are identified  650  and the two participants receive e-mail and text message confirmations regarding the successful exchange  660 . 
         [0144]    As part of final exchange processing, both offers created by our business traveler are removed from the offer database  120  along with the offer created by the second participant. Both tickets are also removed from the inventory database  130 . 
       Matching Process: Two-Way Product Exchange 
       [0145]    To further illustrate the logic involved in the matching process  240 , consider  FIG. 8A , which illustrates the basic data involved in a two-party exchange. The first participant, A, owns a pair of white shoes  800  but would like a pair of black shoes for an upcoming evening event. Participant A is willing to pay $30 in order to exchange their white shoes for a pair of black shoes  810  (a bid offer). The second participant, B, owns a pair of black shoes  805 . Participant B may, in fact, own many pairs of black shoes and would be willing to exchange one pair for a similar pair of white shoes if $30 in compensation  820  were offered (an ask offer). For simplicity, we can assume that all other product attributes shared by the two pairs of shoes (size, brand, condition, etc.) are identical. 
         [0146]    When these two offers and their associated products are compared, we can see that they satisfy each other and represent a match  815 . Participant A wants black shoes, participant B has black shoes. Participant B wants $30, participant A is willing to pay $30. These two offers represent a potential match. Executing this exchange will result in our two parties exchanging products. Participant A will receive a pair of black shoes  825 , and participant B will receive a pair of white shoes plus a $30 payment  830  from participant A. 
         [0147]    Potential applications of this disclosure may involve many more data elements, but the same approach to matching logic can be used. For example, an offer to exchange a train ticket may contain the following criteria: 
         [0148]    1. Origin 
         [0149]    2. Destination 
         [0150]    3. Departure Time 
         [0151]    4. Day of Departure 
         [0152]    5. Seat Position (Aisle, Window, Middle) 
         [0153]    6. Position of Train Car (Front, Middle, Back) 
         [0154]    7. Food Car (Yes or No) 
         [0155]    8. Sleeper Car (Yes or No) 
         [0156]    9. First Class (Yes or No) 
         [0157]    Despite the increased number of product attributes and corresponding offer criteria, two train offers with all of the above criteria can be evaluated in the same straightforward manner by testing each individual criterion. If all product and compensation criteria are met, the two offers represent a potential match. 
         [0158]    To capture the preferences of a more sophisticated participant, offer criteria may involve ranges and logical operators such as AND, NOT and OR. For example, an offer to exchange train tickets using the above criteria may involve criteria such as:
       1. Monday, Tuesday or Wednesday departure with a Sleeper Car.   2. Thursday or Friday departure with First Class and Food Car, but not departing before 9 AM.   3. Saturday or Sunday departure with First Class and Food Car, departing between 1 PM and 5 PM       
 
       Matching Process: Two-Way Product Exchange Across Time 
       [0162]    While many semi-fungible products being exchanged may exist within the same timeframe, this is not necessary.  FIG. 8B  provides an example of a successful product match where the two products exist in different time periods. 
         [0163]    In this example, participant A is in possession of a November 16 th  concert ticket  840 . Due to a conflicting event, participant A is unable to attend the concert on this date but would still like to see the performance on another date. Knowing that there are a series of concerts by this same performer, our participant wants to exchange his ticket for one within three weeks of November 16 th . Of course, he does not want to exchange his ticket for one on November 16 th , so this date needs to be excluded from his consideration set. As long as these date criteria are fulfilled, participant A is willing to offer $100 for an exchange  850 . 
         [0164]    A potentially matching offer is provided by participant B, who is seeking to monetize the value of his ticket. Participant B has a ticket for December 2 nd    845 , but is indifferent as to when he actually attends the concert. Participant B realizes that others may value trading tickets with him, and he is offering to exchange his ticket for $100 as long as the date is within three months of December 2 nd    860 . 
         [0165]    Comparing these two offers and their related products, we can see that they mutually satisfy each other and represent a potential match  855 . If the match is approved and executed successfully, participant A will receive a concert ticket for December 2 nd    865 . Participant B will receive a concert ticket for November 16 th  along with $100  870  from Participant A. 
       Matching Process: Three-Way Product Exchange 
       [0166]    One of the benefits of allowing an automatic match process is the increased potential for identifying multi-party matches.  FIG. 8C  illustrates the logic involved in a three-party exchange of airline tickets. 
         [0167]    In this example, participant A has a middle seat in row  12  and is willing to pay $50 for a window seat anywhere else on the plane  880 . Participant A is attempting to upgrade his product for one that he finds more appealing. 
         [0168]    Participant B has an aisle seat in row  40  and is willing to pay $50 for any seat below row  15   885 . Participant B is driven by a need to make a tight flight connection and wants to reduce the risk of being stranded at a connecting airport. By moving his seat towards the front of the plane, he believes he will be able to exit the plane more quickly and improve the odds of making the connecting flight. Participant B is upgrading his product for one that reduces his risk. 
         [0169]    Participant C has a window seat in row  45  but prefers aisle seating and is willing to pay $50 for an exchange  890 . Like participant A, participant C is attempting to upgrade his product for one that he finds more appealing. 
         [0170]    Within this set of three offers, there are no two offers that fulfill each other&#39;s requirements. Each individual participant, searching for offers on their own, may be unable to find one that meets their needs. However, at a system level we can easily structure a three-party exchange where all parties are fully satisfied. If A&#39;s seat is given to B, B&#39;s seat is given to C, and C&#39;s seat is given to A, all offer requirements are completely satisfied and we have found a potential three-way match. 
         [0171]    In this scenario, all three participants happen to offer $50 as a bid price. Once all three offers are successfully matched, the compensation requirement nets to zero and no actual compensation exchange is required. 
       Transaction Fees 
       [0172]    For simplicity&#39;s sake, the above examples do not illustrate transaction fees. However, market mechanisms commonly require these fees to fund the market infrastructure and generate profits for market administrators. These fees are typically based on either a percentage of the value being exchanged, a flat fee based on the volume of transactions, or a combination of both. Fees may be paid by one or more of the participants involved in an exchange. 
         [0173]      FIG. 8D  expands the example of  FIG. 8A  to include transaction fees. Once again, participant, A owns a pair of white shoes  891  but would like a pair of black shoes. This particular market requires a flat $5 transaction fee paid to the market maker. Participant A&#39;s complete offer consists of a desire to exchange her white shoes for a pair of black shoes, a willingness to pay the other party $30, and a willingness to pay the market a $5 transaction fee  893 . 
         [0174]    The second participant, B, owns a pair of black shoes  892 . Their offer consists of a willingness to accept an exchange for a pair of white shoes plus $30 from the other party and a willingness to pay the market a $5 transaction fee  895 . 
         [0175]    When the criteria of these two offers are compared, we can see that they satisfy each other and represent a match  894 . Executing this exchange will result in our two parties swapping products. Participant A will receive a pair of black shoes  896 , participant B will receive a pair of white shoes and a net payment of $25  897 . The market will receive $10 in transaction fees  898 , $5 from participant A and $5 from participant B. 
       Business-to-Business Process Perspective 
       [0176]    The above examples explored the exchange process from a consumer-centric perspective. In fact, the same process can be used for a business-to-business product exchange. While the process itself remains unchanged, the nature and motivations of the participants can differ. 
         [0177]    To illustrate a business-to-business exchange opportunity, consider two companies who produce different products that happen to share some semi-fungible materials or components. These companies may have no clear view of long-term market demand for their output, but at some point in time are able to predict near-term demand with a reasonable degree of accuracy. 
         [0178]    There are many real world examples of this dynamic. Consider manufacturers that produce electronic goods for the retail market. Any given manufacturer may have some general idea of what next year&#39;s demand may look like, but it is not until their sales teams lock in agreements with retailers that they are able to forecast future sales with any degree of accuracy. Additionally, in this industry just-in-time (JIT) orders are commonplace, giving manufacturers little time to react to changes in demand. While a just-in-time supply chain may benefit the extended manufacturing ecosystem, it may also place increased pressure on manufacturers to carefully manage their material inventory levels. 
         [0179]    Operating in this type of environment, companies may be expected to create advance orders for key materials and components where supply is uncertain. Manufacturers of electronic goods may place advance orders for touch-sensitive glass displays, processors, and other key sub-assemblies. Aerospace and defense contractors may place advance orders for specific types and classes of titanium and carbon composites. Food manufacturers may place orders for difficult to procure seasonal ingredients. 
         [0180]    This type of advance planning assures manufacturers that they will be capable of a certain minimum level of output. Of course, given the variable nature of supply and demand, it is unlikely that a manufacturer will ever develop a series of perfect orders. Most of the time, as demand becomes more visible, manufacturers will find that they have either too much or too little of what they need. When these errors can be balanced out across companies, an exchange of advance orders may benefit both organizations. 
         [0181]    In  FIG. 9 , we return to our two company example and illustrate how this might occur in a quantitative way. Company A has assumed a ramp-up in demand across its four planning periods  900  beginning with 100 units in period  1  and ending with 400 units in period  4 , for a total demand of 1,000 units. Company A places advance orders  905  using this assumption. Unfortunately, some time later it obtains a clearer picture of future demand, and now believes that it will experience flat demand of 250 units across all four planning periods  910 . While the total demand estimate of 1,000 units happens to be precisely correct, this does not allow the company to avoid overages and shortfalls in every period  915 . Most importantly in terms of near-term revenue, a shortfall of 150 units will occur in period  1  and a shortfall of 50 units will occur in period  2 . Assuming that Company A&#39;s supplier has constraints of its own and there is no extra inventory available, Company A may not be able to meet customer demand in periods  1  and  2 . 
         [0182]    This is in contrast to Company B&#39;s situation, where in every time period  920 , their advance orders  925  are consistently below their revised demand forecast  930 . If this situation is not addressed, Company B will be left with an overage of 100 units in all four planning periods  935 . At best, this excess will absorb valuable working capital. At worst, the material may become obsolete after some time and could represent a complete write-off expense. 
         [0183]    In this example, Companies A and B can benefit each other by exchanging advance material orders. Company A would like to obtain 100 of Company B&#39;s extra units in period  1   940  and 50 of Company B&#39;s extra units in period  2   945 . While this does not completely address either company&#39;s problem, it does leave them better off than they would be otherwise. 
         [0184]    This example of an exchange between two manufacturing entities is simplified. Many manufacturer markets consist of hundreds or thousands of companies that may share thousands of inputs. One practiced in the art will appreciate that once the size of the market is combined with the potential for three-way or four-way exchanges, attempting to identify potential exchanges without the benefit of a supporting exchange infrastructure is impractical. 
         [0185]    While specific implementations and hardware/software configurations have been illustrated, it should be noted that other implementations and hardware configurations are possible and that no specific implementation or hardware/software configuration is needed. Thus, not all of the components illustrated may be needed for implementing the methods disclosed herein. 
         [0186]    The above described embodiments are intended to illustrate the principles of the invention, but not to limit the scope of the invention. Various other embodiments and modifications to these preferred embodiments may be made by those skilled in the art without departing from the scope of the present invention.