eBay executives have talked a lot about its strategy of targeting “high-value” and “enthusiast” buyers, but what does that mean exactly?
eBay’s Chief Business and Strategy Officer Stefanie Jay explained what the latter term meant and provided some examples during a presentation at the eBay Open event held in September and said sellers could benefit from understanding these types of buyers.
Of eBay’s 138 million buyers worldwide (at the time of the presentation), enthusiast buyers were eBay’s “best and most valuable group,” she said. They are collectors, hobbyists, category fanatics who are looking for things like trading cards, sneakers, handbags, car parts – “unique things that bring them a lot of joy.”
- Enthusiast buyers account for 70% of eBay’s GMV (gross merchandise volume – eBay explained its new definition of GMV last year).
- They spend 9 times more than the average non-enthusiast buyers.
- They shop 30 different days each year on average.
- They spend $3,000 per year.
- The increase their “spend and purchase days” by 50% after the first year on eBay.
- The average enthusiast buyer has been on eBay for about 12 years.
There are 4 main categories of enthusiast buyers:
- Sourcing pros: they leverage eBay for their commercial activity.
- Category-centric buyers: they are hobbyists or collectors
- Value seekers: they are looking for great deals and discounted prices, mostly in electronics and fashion
- Horizontal buyers: they shop across all categories but aren’t as price sensitive as value seekers.
Jay said understanding category-centric buyers and value-seekers could help sellers to grow their business. She described one category-centric buyer named Nick, who spent $2,300 on eBay, 65% of which was related to sports memorabilia.
eBay talks a lot about focus categories, Jay said, but that’s because enthusiast buyers also make purchases outside of their main category.
Referring back to Nick, who spent $800 outside sports memorabilia categories, she said the breadth and depth of eBay’s inventory “makes sure that the Nicks of the world keep coming back.”
“This is foundational to building loyalty and repeat buying,” she said.
Jay then introduced “value-seeker” Phil. Value-seekers know how to navigate eBay’s platform to find value across every category. Some of Phil’s purchases were used goods, had free shipping, or were made through a seller offer (you can learn more about offers to buyers on eBay Seller Center).
Value seekers come back to eBay for the breadth and scale of inventory at competitive prices.
Jay said eBay is helping sellers turn customers into repeat buyers with tools that enable more visibility and velocity. One example she cited was “Save this seller,” which is prompted when a buyer makes a purchase. “After they check out, they can opt to save you as a seller.”
While it may seem simple, Jay said the “Save this seller” prompt has quadrupled the number of saved sellers to date – and it has led to greater purchase frequency. Other tools include the ability for sellers to make offers and use coupons.
It’s interesting to hear how eBay describes its strategy, but it hasn’t stemmed the decline in the total number of buyers. Earlier this month, eBay reported it had 135 million active buyers at the end of the third quarter (compared to 152 million at the end of Q3 2021).
In 2021, eBay CEO Jamie Iannone and Chief Financial Officer Steve Priest discussed their new approach to buyers and explained the distinction between “high-value” buyers and “low-value” buyers ( see “eBay CEO Jamie Iannone Rejects Predecessor’s Approach to Buyers“).
Theoretically eBay’s focus on value-seekers should be fruitful as more people are trying to save money due to economic challenges. But eBay rivals aren’t immune from economic uncertainty either.
Stefanie Jay joined eBay last year from Walmart, where current eBay CEO Jamie Iannone had been before rejoining eBay in 2020. Will they be able to draw from their experience at the major discount retailer to attract more value seekers? Feel free to let us know what you think in the comments below and what tools you use to attract buyers and then turn them into repeat customers.