eBay was keeping up with the marketing environment until Donahoe took over in 2008. I do not believe that he chose the correct timing to change the company to align it with the needs of the power sellers. 2008 was a year when the economy was down in the dumps and unemployment was very high. This is a time when not only were individual sellers trying to auction off their belongings to survive but also people should have been going to eBay to get deals on items that they needed. Donahoe missed this opportunity for the company. Many sellers were upset with the changes and opted to use other ways to sell their items like craigslist and amazon. If Donahoe would have waited to change the structure of the company until the economy improved he may have not experienced initial declines.
The more current successes with mobile marketing and app creation are right in line with today’s market. eBay will continue to prosper and possibly even catch up to the competition if they continue to follow the marketing environment and play to the buyers.
eBay has geared itself towards the power sellers. These “sellers” are actually small or large companies that use eBay as their storefront. These power sellers can buy in bulk and offer deep discounts for buyers, they can import goods and sell them at below the asking price in most stores. The new sellers have created a way for buyers to get a great deal at a fixed price.
I do not agree that the turnaround strategy was the best way to go. If I were creating the plan then eBay would have stayed as it was, a place for individual people to sell their items. Then I would have created additional apps and sites using the eBay name, like eBay Fashion. These site would have been the new vision where it is all power sellers and storefronts with fixed prices. In my vision the buyer gets the best of both worlds and the smaller sellers are not forced out. The company would continue to make a profit off of the small sellers, who have at this point gone in other directions, and they would capture the new market where power sellers set prices and buyers can go on the site and know what they will pay for an item.
Half.com, which is owned by eBay is a great example of how a separate site can and will work. The site is specifically for books, movies, video games and video game consoles. This site offers fixed prices to buyers and the sellers are a mix of small sellers and power sellers.
In five years I predict that the company will be competitive with amazon.com and walmart.com. eBay is stepping up to the plate in the mobile marketing department right at the correct moment. They can capture a division of buyers for their products and as long as they continue to evolve with the marketing climate they should gain momentum and become competitive again.