eBay CEO John Donahoe told Wall Street analysts the company would be expanding its Global Shipping Program (GSP) beyond the U.S. Donahoe was speaking at the Goldman Sachs Technology and Internet Conference on Wednesday when the topic arose.
“A lot of the eBay sellers in the U.S. don’t want to deal with the hassle of shipping to international markets, and particularly international markets that may have customs clearance, or duties or complicated returns issues,” he said.
He described the Global Shipping Program in which eBay works with Pitney Bowes to intermediate between sellers in the U.S. and their international buyers – “and this will increasingly happen in other markets,” Donahoe said.
Items in the GSP program are available on eBay sites all over the world, and when an item sells, the seller sends the item to a warehouse of a third-party partner – Pitney Bowes – in the U.S., which then handles all the international shipping, customer support and returns.
eBay is “removing friction” for the seller and providing a great experience for the buyer. The latter is a reference in part to the fact eBay adds all customs, taxes and duties into the price of GSP items visible to international buyers – something eBay says buyers want so there are no surprises in the cost of purchasing the goods. Sellers have expressed concern that it makes their goods more expensive relative to domestic offerings, and some have wondered if GSP is a profit center for eBay and Pitney Bowes.
Donahoe told analysts, “Cross border is an area where we’re really focusing on making it easier for sellers all over the world to ship all over the world, and trying to make it easier for buyers to buy from the global inventory not just their local inventory.” He also revealed that 20% of eBay Marketplaces business is cross border trade.
eBay launched its Global Shipping Program in 2012 in a pilot program and made it available as an option for U.S. sellers last year. But it has since tied participation in the once optional program to its new User Agreement, unbeknownst to most sellers who click to accept the agreement without being aware of the GSP provision.
As a result, some sellers who have settings set to ship to domestic buyers only are taken by surprise when one of their items sells to an international buyer. An experienced seller describes what happened to him after accepting the new UA in this letter to the editor.
International is a big opportunity for eBay, Donahoe told the Goldman Sachs crowd. “If you look at the new user growth, a disproportionate share of the new user growth for both eBay and PayPal are coming from BRIC (Brazil, Russia, India, China) and emerging markets.”
See also eBay Global Shipping Undeliverables End up Back on eBay on the EcommerceBytes Blog.