Before voting for Meg Whitman for governor, residents of California would do well to consider what has been happening at eBay since she stepped down as chief executive. John Donahoe, her successor, has pretty much disassembled all of her major strategic moves.
He is undoing her acquisitions of Skype and StumbleUpon. It turns out that neither voice communications nor Web surfing has anything to do with what eBay does.
More subtly, but maybe more important, Mr. Donahoe is backing off from Ms. Whitman’s initiative to take on Amazon.com and make eBay an important player in the marketplace for the purchase of new, current-season goods. Her acquisition of Shopping.com was part of that, as was the move to expand features like eBay stores on the main site.
There was more than a little irony in the headline of the report that Sandeep Aggarwal, an Internet analyst at Collins Stewart, sent out Thursday about eBay’s results for the first quarter: “Is eBay Becoming Amazon for Secondary Market?”
Mr. Aggarwal noted that eBay was using Amazon tactics – free shipping, fixed prices and a better site experience – for eBay’s classic market of used, discontinued and unusual products.
That seems a great deal more sensible than Ms. Whitman’s plan to build sales of mainstream merchandise easily available elsewhere by using eBay’s structure – seven-day auctions, high merchant fees and sellers of varying reliability.
The dimension of the challenge is that eBay’s core auction business is losing revenue quickly – down 18 percent from a year earlier – even in a U.S. recession that should benefit the company. After all, eBay should be the refuge of cash-strapped bargain hunters.
During a conference call with investors Wednesday to discuss the quarterly results, Mr. Donahoe outlined a plan to focus on the sort of out-of-date merchandise that has been the stuff of outlet malls.
Mr. Donahoe is excited about one of Ms. Whitman’s acquisitions – PayPal. I’m not sure that this is an unadulterated credit to her, as eBay wouldn’t have had to buy PayPal if it hadn’t been so slow to expand its own credit card payment system.
Source: (C) 2009 International Herald Tribune. via ProQuest Information and Learning Company; All Rights Reserved
By Saul Hansell / The New York Times
April 27, 2009
source: hispanicbusiness.com