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Impact of eBay Data Breach Continues, Says Marketplaces VP

The President of eBay Marketplaces indicated the company is still facing headwinds following a security breach earlier this year that led to it requiring customers to reset their passwords. Devin Wenig was speaking at a “fireside chat” at the Citi 2014 Global Technology Conference on September 4th.

“For those that don’t know, we required 150 million customers to reset their password, not a simple thing for an ecommerce company do to.” He said it “created a divot, and we are still seeing a bit of a headwind from that data issue.”

Wenig said that while users representing 87 percent of eBay’s trailing GMV have “gone through the password flow,” many have not – 300,000 additional customers continue to come through each day. However, up to 14% of those are going through the reset process again. That’s because many users had to reset their passwords after having had them for many years and then forgot the new passwords and had to obtain new ones.

“In some of our biggest countries we have seen 14 percent of the user base go through more than one password,” Wenig said.

In response to a question about whether users were spending less than before the breach after resetting passwords, Wenig said that was not the case that they’ve seen, particularly for the core user base.

“What we have seen for core users is once they are through, their spending patterns are back to where they were. We haven’t seen very much difference at all. I am not worried that we have done permanent brand damage, but it’s clear we’re not done with the headwind.”

What is the value of users who are not going through the process? “I don’t want to lose any user, but we haven’t lost very many,” Wenig said, with very few account closures happening only within 3 weeks of the breach being announced.

Not everyone has come back through the flow because not everyone comes back at the same time. “A lot of people shop online more frequently during the holiday season,” he said. “More users visit eBay during the holiday.”

Analysts did not raise the issue of the ongoing investigation of eBay’s data breach by state attorneys general, nor did they ask Wenig about the technical issues that prevented eBay users from logging in the day before.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.