Our plans are not without risk, but I believe we’re on the right path.
An upbeat, if cautious, assessment from eBay CEO Devin Wenig on the online marketplace firm’s efforts to re-invent itself in an increasingly competitive e-commerce retail landscape. Since splitting with PayPal, eBay has been repositioning its offerings, which has included some significant overhauls of existing tech. Wenig says:
We’ve been working on an ambitious replatforming of eBay to drive the best choice, the most relevance and a powerful selling platform. This includes a work we’re doing on our mobile platform, building product catalogs on structured data, launching new browse inspired shopping journeys, re-invigorating our C2C business and sharpening our brand.
Financially, eBay is doing OK for now. For the quarter ending March 31 was $2.2 billion, up 4% year-on-year, while net income of $1.04 billion topped analyst expectations. The firm also added 2 million active buyers across its platforms to hit a total of 169 million globally.
But with competition from the likes of Amazon and Alibaba growing, there’s no room for treading water, so eBay needs to focus on enhancing its customer experience. That’s meant introducing changes in how the users interact with the site, says Wenig:
We started to land users directly on our new browse pages when they search for certain broad-based keywords, connecting structured data experiences to our core organic traffic. We are leveraging our 25 million new product reviews more extensively with the launch of a top-rated module in our browse experience. And we’ve enabled users to upload pictures in product reviews, making them more impactful.
The firm has also begun rolling out a new homepage, using structured data and artificial intelligence tech to create a personalised shopping experience. Wenig explains this as being a search to deliver “a homepage that is simpler, more personal and discovery based, helping them find their version of perfect, no matter what it is”.
With nearly 50% of transaction volume now closing on a mobile device, the focus on mobile experience is all-important, he adds, with the latest release of the mobile app built around providing “a significantly simplified consumer selling experience that uses our growing structured data catalog coupled with a more efficient listing flow”.
With an eye on expanding its e-commerce footprint, eBay has recently signed a deal to invest in and partner with Indian firm Flipkart. Wenig says:
We continue to believe there are significant opportunities to expand our business inorganically through our M&A and partnership strategy, we’re continually evaluating opportunities to broaden our reach and our capabilities. We also constantly monitor our existing portfolio of assets, and we take action when we don’t see a clear contribution to our strategy or a path to win.
[Flipkart] enables us to increase our penetration in India by making eBay’s global inventory accessible to a significantly larger set of Indian consumers. Additionally, eBay’s millions of active buyers will have access to more unique Indian inventory provided by Flipkart. The team at Flipkart are strong executors, with deep knowledge of the local Indian market. And we’re committed to winning in India through this partnership.
Wenig also identifies a need to beef up brand managment in the more competitive macro-environment in which eBay competes:
We’re now on 18 different social channels and messaging platforms. We’re seeing better ROIs. I think we’ve been doing this for quite a while. We’ve been pretty good at it and we’re optimizing those channels very well. So across the piece we are going to lean into this to try to drive traffic and buyers to what we think is now rapidly improving experience.
Interestingly, Wenig sees a shift in the way that eBay interacts with other brands:
There’s no change to our conversation with retailers and there’s definite change to our conversations with brands. So vis-à-vis retailers, it hasn’t since the new leadership team took over it hasn’t been a core part of our focus. There are some retailers that sell successfully on eBay. We’re pleased about those relationships, but we’re not looking to expand those relationships aggressively and we’re more focused on bringing outstanding inventory and where we can direct from the source.
I think that the conversation with brands has definitely changed. They’re now looking at a platform that is doing $20 billion a quarter, it has 169 million active buyers. I expect that will accelerate the pace of brand acquisitions through this year, meaning there will be more brands that sell directly or through resellers on eBay directly. Those conversations I think have gone very, very well. I think that for brands what they see in eBay is a cost-effective channel to and a very progressive technology partner, which is what they need to navigate the world that’s coming.
Overall, Wenig concludes that it’s a case of some achievements clocked up, but with a lot of work still to do:
We’re making steady progress in our journey of changing eBay. In the past year, we have improved both the foundation of the business and our operating results. This improvement has not always been linear and it may not be going forward, but Q1 was a good start to a year where we expect to make significant progress, redefining the eBay user experience and brand.
A work in progress, but one that has shown demonstrable progress.
Image credit - eBay