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Tue Sept 30 2014 09:00:49

How Will John Donahoe's Tenure at eBay Be Remembered?

By: David Steiner

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In baseball, there's a saying after a team has a bad season: You can't fire the team, you fire the manager. 

John Donahoe's team at eBay has had a bad season, with growth that didn't keep pace with its competitors, a public confrontation with investor Carl Icahn, security breaches, site outages,.. you could say that eBay has had a very bad season.

Today, eBay announced that it will be splitting eBay and PayPal into two separate companies. Devin Wenig will head eBay, while American Express executive Dan Schulman was named as president and CEO-designee of PayPal. John Donahoe and CFO Bob Swan will have no executive position in the new companies.

No matter how John Donahoe's departure will be spun in San Jose, this was not a decision by Donahoe to "spend more time with family." It's not difficult to understand why eBay is going in another direction with its leadership. The question is why the board stuck with him so long in the first place.

Donahoe's lack of vision for the marketplace was severely out of place in an innovation-driven industry. His disregard for eBay's most valuable asset - its small sellers - was evident in his inability to communicate changes in policy to users in a timely fashion. Unannounced changes to the site sent merchants scurrying to catch up, causing them to change workflow (or stop altogether) and revise listings.  

While many sellers, prior to Donahoe's tenure, were able to resolve issues by reaching out to category managers within eBay, reports were rampant of staying on hold with outsourced customer service, often leading to no resolution of the issues.

Donahoe's legacy will be a dysfunctional search engine, a major security breach that compromised customers' sensitive information, and preferential treatment of large-box retailers, both domestic and Chinese, that took the eBay experience from one of being about Discovery, and made it mundane.

The bottom line is that Donahoe was the wrong man for the job.

Former CEO Meg Whitman professed that "a monkey could drive this train" when asked about leading eBay.  Despite her own shortcomings, Whitman seemed to have an understanding that eBay was a self-sustaining (and for the most part, a self-governing) entity. Even though eBay is comprised of hundreds of thousands of disparate merchants, they all have once thing in common: Profitability. The vast majority of sellers know that to sustain their businesses, they have to maintain good service and give customers a good experience. Nothing is as strong a motivator as acting in one's own best interest.

This is not to say that eBay did not have problems prior to Donahoe's tenure. Fraud was a constant problem, fee circumvention by sellers was an issue, technical problems were frequent due to the site's ancient platform. But six years later, are any of those issues any better?

Donahoe will reach back to his Bain roots and oversee the split of eBay and PayPal, then will likely remain on the board of one or both companies. And while it remains to be seen how eBay's merchants will fare under Devin Wenig, one thing is inarguable. The Donahoe Era was a disaster for small sellers.

David Steiner is cofounder and President of EcommerceBytes.com

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Perminate Link for How Will John Donahoe's Tenure at eBay Be Remembered?   How Will John Donahoe's Tenure at eBay Be Remembered?

by: donald This user has validated their user name.

Wed Oct 1 06:33:26 2014







if I was you all, continue to call eBay and PayPal  CS  and give them a piece of your mind. Is only fair they taste their own medicine. They may reconsider all the damage they caused if we all bombard them with calls .....





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by: corpuschristi1956 This user has validated their user name.

Wed Oct 1 07:27:21 2014

How Will John Donahoe's Tenure at eBay Be Remembered?

Who the heckle wants to remember THIS? If someone could invent an over the counter drug to erase the memory of certain ill-fated concepts, Bill Gates and Ma would have a contender!

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by: Ogri This user has validated their user name.

Wed Oct 1 08:52:34 2014

Apart from in every interview waving a phone around like a late night adult TV channel (not that I watch them but sometimes skipping through the channels trip over one or two...). memory is of trying to convert ebay from a long tail business to short tail.

By that mean (using DW's description of ebay as long tail) the bulk of sales and revenue comes from low volume niche items and small sellers.  JD tried to convert ebay into a short tail business by encouraging big stores, big prices, big numbers and discouraging small sellers.  That has resulted in a long unhappy shrinking tail and a fat overweight body.
Im no Darwinian animal evolution expert, but think long tails are usually there for a reason and serve a purpose, cutting them down unbalances the 'animal' and makes it no longer able to thrive/survive.

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by: Russ This user has validated their user name.

Wed Oct 1 08:54:10 2014

Donohoe is already being erased from the minds of business writers, case in point would be Fortune magazine's Philip Elmer DeWitt.  His item this morning refered to eBay's CEO as ''Donovan.''  Not only once but every mention...Gotta love it!

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by: used2luv2sell This user has validated their user name.

Wed Oct 1 09:43:10 2014

@Ogri, great explanation!

That old game ''Pin the Tail on the Donkey'' came to mind.  hehehe

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This user has validated their user name. by: Map

Wed Oct 1 10:02:03 2014

@Ming is Correct.

The entire leadership at ebay must go.

Many thanks to the Steiners.

I have sent many request to CNBC asking them to interview Ina about the facts about ebay that are reported on ecommercebytes.com.

Wall street media has been ignoring seller complaints and I assume that they will continue that.

I am no fried of Icahn but he is the enemy of my enemy and He got them good.

The war is not over yet. and for sellers it will continue to get worse until the all the JD Bainsmen are out of ebay.

It is unacceptable that JD remain on the boards and Devin Wenig appointed ebay CEO.

The sell off of ebay is unavoidable. Now that these two men have been forced, they will do what Bainsmen do...plunder the Company Accounts, Fleece the sellers more & sell ebay walking away with the loot.

It will only get worse for sellers till these men have sold ebay in late 2015 or 2016.

We sellers must prepare for a long hard winter.



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This user has validated their user name. by: Ric

Wed Oct 1 11:21:34 2014

As has been said by many, Donahoe's tenure at eBay has been an unmitigated disaster for eBay's small sellers.  

Donahoes complete lack of experience as an eBay user, coupled with his dismissive view that small eBay sellers were little more than "noise", his departure is long overdue.

Donahoe did not grasp and failed to value the simple fact that eBay was built upon the basic idea of small sellers bringing products to the marketplace to trade and sell with others. The longer Donahoe continued to ignore this basic precept, the less productive eBay's marketplace became.

Under Donahoe, eBay went from an extremely well recognized household brand to one that is largely despised and reviled. This did not happen because buyers were not happy as the marketplace ignorant Donahoe claimed. eBay's state of decline occurred due to the fact that Donahoe instituted extremely unrealistic and unpopular seller policies, which continued right up to the day of this announcement.

Donahoe was not simply the wrong man in the wrong job. Donahoe was a CEO who stumbled blindly into a job for which his vision misguided by his inability to relate to his core customers and failure to comprehend the negative impact of his actions on small sellers.

Donahoe is doing the only thing he is good at, destroying the value proposition of being an eBay seller, then after destroying livelihoods of hard working sellers, is simply going to liquidate the platform because he could not mold it successfully to his own will.

Good riddence.

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This user has validated their user name. by: bitbybit

Wed Oct 1 13:05:04 2014

How will Donahoe be remembered? As a greedy, poor excuse of a human being. Lower than scum. As far as keeping Donahoe on the board goes..makes it convenient for when they come after him to be incarcerated.  

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by: dans parts This user has validated their user name.

Wed Oct 1 16:53:30 2014

I don't think Donuthole should be forgotten.  As despised as this man is, he should go down in history with other despicable characters that cannot be ignored, if only to be able to point out the valuable lessons they can provide, if we view those lessons with the correct ''lenses'' - not revisionist, not sugar-coated, but object lessons for life and business.

Don't know if it was Ming or someone else here that's been saying Donohoe (and eBay) will be written about in the future as a classic example of how to NOT run a business, or, more to the point - how to RUIN a business.

And Ric, you mention unrealistic Seller policies, which probably will not go away, at least for quite a while, if ever.

I had a case opened on me today. I sent the wrong item out on Monday.  Realized it 2 hours later, emailed the guy telling him I screwed up, and would be mailing the correct item on Tuesday.  I did mail Tuesday.  He gets the first package today, and opens the case, either because he's a doofus, or just simply doesn't bother to read emails.  But, the unrealistic and unfair part is that defect for SNAD will never go away, even though I pro-actively handled this problem BEFORE a case should have even been opened.  No amount of wheedling from me, or apologizing from the Buyer (to eBay even) that he made a mistake in opening that case will ever get that Defect to disappear.

And that unfairness, even when bolstered by hard proof from BOTH sides of the argument, no less, is at the core of eBay's (and Donuthole's) egotistical and arrogant attitude toward Sellers.  And the reason why eBay can now be described as ''reviled''.  It doesn't take long for the attitude to bleed from one side to the other (from Sellers to Buyers).

I happened across a woman in the Post Office the other day who saw my bundle of packages and said, ''eBay?'' ''Yep!'' She then proceeded to tell me she had been thinking of starting a business on eBay.  Of course, to which I replied, ''Are you crazy??''

As I stood there telling her all the horror stories, both of the clerks behind the window interjected their comments on the subject, just reinforcing what I was telling her.  Or course, maybe they're just sick of listening to me bellyaching all the time, and didn't want another complainer.

We've come a long way since 1999, when I remember signing up for eBay, realizing I could make D*#m good money here - like ''WOW!  I'm so glad I found this place.''  Roll forward to 2014 and the comment most heard seems to be ''I wish I could get away from eBay - I hate it!''  Quite a sound bite, eh?

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This user has validated their user name. by: Anonymous Annie

Wed Oct 1 17:06:53 2014

I've always loathed that smug grin of his and it makes my skin crawl to see his photo. (I've just added the photo above to my browser's ''adblock'' feature, so I won't have to see it any more as I continue to read this thread.)

In one of these threads, someone linked to a site that had a video of JD being interviewed. --- Honestly, I'd never heard him speak before... this interview was the first time.

And again, he made my skin crawl! What a self-serving, arrogant, lying, hypocritical POS! He's such a dweeb!

All of his talking-points and responses sounded SO rehearsed, and SO insincere.

It was as if he was in a competition with himself to see how many corporate jargon words and phrases he could use in a single sentence. (Frankly, it made him sound like a complete moron.)

If he would have said ''SYNERGY'' one more time, I would have SCREAMED!!!

http://en.wikipedia.org/wiki/List_of_buzzwords

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by: ebayroadkill This user has validated their user name.

Wed Oct 1 17:08:27 2014

Let's take a bit of a look here at eBay as a whole. 18 years ago, eBay changed the face of eCommerce. Not only were brick and mortar stores discovering the on-line experience, eBay placed the power of eCommerce in the hands of the people. The individual. That honest person who found that there was a vast market for their items that were just too good for a garage sale. eBay also brought the auction format to people who never had a clue or experience of a live auction. It was great! It changed the business world, especially C2C, forever.

Yes it had some problems. Scammers found eBay as a method to do business, and there were some other bugs that surfaced along the way, but eBay was pioneering a new trail. Consumers discovered that they could ride along and make a living by selling on eBay, it wasn't easy, and there were bumps along the way, but eBay changed a lot of lives.

Then John Donahoe came along. He demonstrated a hatred for the core eBay system. Instead of fixing the minor things that were still broken the way a technician would carefully adjust and oil the core function of a fine machine - he did everything possible to destroy the working machine and turn it around to an Amazon Fighting Machine and do so at a pace that would keep the investors blind to the destruction. He did what he could to rid the bad sellers and the good sellers that did not meet his vision as an Amazon Fighting Machine. He squeezed and squeezed, choking the actual paying customer of eBay - truly shooting the nose in spite of the face. eBay may recover, but only if a true visionary of the core values of eBay takes over. This very much might not happen.

John Donahoe will be remembered as the person who took a good business and did his best to smash it into ruins. If eBay does live on, these past years of trouble and turmoil will be known as the ''Donahoe Era of Darkness''. If eBay collapses, John Donahoe will be the spit of Wall Street. If John Donahoe were in out in the cold on the street, maybe Jeff Bezos will buy him a cup of coffee and give him a hearty handshake of thanks for all he did for Amazon.  

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by: pace306 This user has validated their user name.

Wed Oct 1 17:29:44 2014

"If John Donahoe were in out in the cold on the street, maybe Jeff Bezos will buy him a cup of coffee and give him a hearty handshake of thanks for all he did for Amazon. "

ebayroadkill is 1000000% correct. JD did more positive things for Amazon then anyone else ever could.

Bezos owes JD a HUGE amount of gratitude.

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This user has validated their user name. by: LDS Brother

Wed Oct 1 17:50:45 2014

Well I may have to disagree with you all about the worse CEO ever !!!!!

He may be the BEST CEO ever ( For Amazon )

Just look at what Amazons stock was when JD took over, and look at it today !

Bezos owe JD MUCH !

Donahoe treated us all like sh*t !

Didn't say Hi, I am new CEO he said
I am "ASHAMED of eBay" and "Sellers are just NOISE !"

Sorry I nominate John Donahoe as the BEST CEO ever ! For Amazon !

He made Amazon grow by leaps and bounds !

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by: ThriftyDog This user has validated their user name.

Wed Oct 1 18:06:15 2014

Donahoe was an azzhat.  Good riddance to bad rubbish.

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This user has validated their user name. by: LDS Brother

Wed Oct 1 18:33:12 2014

Maybe Donahoe will just grow his hair long, grow a long beard and mustache and go live in exile somewhere with all the MILLIONS he got off us sellers, while he abused, tortured us with his unrealistic policy's and had many of us put out of Business with the untrue, unfair OPINION of just a few buyers !

I know I would grow my hair and facial hair, and try to hide what I looked like, he is the UNDISPUTED CHAMPION of being the MOST HATED/DESPISED CEO in History, in my opinion !

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by: troglites This user has validated their user name.

Wed Oct 1 19:08:20 2014

I think there is a saying something to the effect that the definition of ''crazy'' is doing the same thing over and over and expecting different results. I wish I could be happy about this, but I think with Wenig nothing will change. He is just a carbon copy of the Donahoe - maybe even worse if that's possible. But I do believe a great deal of damage has been done, so it will be interesting to see what happens. I will remember Donahoe as an elitist who elevated himself at the expense of others, and as a man who could not overcome his obsession to become larger than Amazon. And that obssession and greed ruled his decision making processes.

The changes in Ebay's policies have been incredulous at best and has for the most part brinked on the border of insanity. His contempt for small sellers was palatable and he achieved his goal to drive them off, through a so called well orchestrated process of attrition through policies that many can not weather. This covert strategy supposedly made the seller culpable, and John thought he would come out smelling like a rose. Many sellers lost their businesses - so many good sellers that did not deserve what happened to them. I agree - Amazon is indebted to him.

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by: Massachusets Howler This user has validated their user name.

Wed Oct 1 20:57:17 2014

I thought "Paypal was the FLYWHEEL of ebay"??

Oh Mr. Donahoe, your FLYWHEEL appears to have flown off!

(Better call AAA and get a TOW).

Just WHAT will you do without your FLYWHEEL?

With nobody forced to use Paypal NOBODY will use it- WATCH AND SEE as everybody HATES PP- the WORD is OUT!

Alibaba doesn't want your filthy Paypal and nor does ANYONE else.

(Will they develop a new payment "system" to screw us or will they LOCK US INTO this "separate" paypal).

Do not get me wrong, I am pleased too, this has been a lot of work.

This could also be a desperate strategy to pump the stock 15 days before the quarterly report so I am holding my breath.

Everybody hang on and see where this goes in the next 15-30 days.

Very funny timing for this "announcement", 15 days before the report.

The Steiners are wonderful, and boy do we appreciate them.

Mass Howler

Ebay now has no FLYWHEEL. Ebay is TOAST.

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by: Henry This user has validated their user name.

Wed Oct 1 22:01:41 2014

Two words - Colossal Failure. This man did more to destroy a once awesome company than anyone could have imagined. He can't be gone soon enough. I hope Mr. Wenig has some grasp of how to run an eCommerce company. As Dusty Springfield once sang "Wishin' and Hopin'". Only time will tell. Someone should write a book titled "The Complete Destruction of eBay". OK - rant over.

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This user has validated their user name. by: Ming the Merciless

Wed Oct 1 22:42:25 2014

From now on just call me the Fort Knox Ninja or Ninga!

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by: dr shock This user has validated their user name.

Wed Oct 1 23:17:51 2014

We don't know what was going on behind the scenes but maybe the Board of Directors finally came to their senses and realized Donahoe's ''5 Year plan'' was a failure.
Donahoe's ego wouldn't let him admit he made a mistake but perhaps his successor will reverse some of JD's bad decisions.
Arrogant CEOs (like JC Penney's Ron Johnson) would rather destroy a company than admit they made a mistake. But it only took J.C. Penney 17 months to dump their CEO.

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