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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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This user has validated their user name. by: Philip Cohen
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Fri Oct 10 15:19:30 2014

"... one thing is inarguable. The Donahoe Era was a disaster for small sellers."

And, don't forget the eBay long shareholders. They’ve never had a cash dividend and ...

Notwithstanding that the eBay Dept of Spin has previously claimed a “400% increase” in eBay’s stock price from its ~$10 low during the 2008–2012 global recession, the fact is, in August 2007, immediately prior to the beginning of the GFC, when the "Pain From Bain", John Joseph Donahoe II (aka Johnny Ho)—now into the eighth year of his planned “three-year turnaround” of eBay—was already effectively in control of eBay, the share prices of eBay and Amazon were both ~$40. With eBay recently less than $50 and Amazon greater than $300, clearly, the “smart money” on Wall Street recognises eBay Inc. to be a "dog", and Johnny Ho to be a very poor dog handler. The fact is, relatively speaking, eBay’s “long” stockholders have been going backwards ever since the cretinous, narcissistic, sociopathic Johnny Ho was handed the helm …

Had Pierre Omidyar in August 2007—before he allowed the control of eBay to pass to the delusional Johnny Ho—traded in just the ~108 million eBay shares that he still holds today for shares in Amazon, instead of his current ~$6 billion, his worth would now have been ~$32 billion! Now that, surely, is something for all of eBay's long-suffering shareholders, and its shills, to think about, is it not? ...

The only people who have taken any cash out of eBay are the headless turkeys in the executive suite, most of whom have received generous bonuses on the basis of "performance" of which there is no record in the share price ...

The eBay executive suite—where the incompetent mingle with the disingenuous, the malevolent and the outright criminal, and the just plain stupid ... http://bit.ly/11F2eas

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

by: dlweld This user has validated their user name.

Mon Oct 13 11:48:04 2014

Sooo pleased "the destroyer" is going. I used to be a big seller on eBay but left years ago when Donahoe had mucked things up so royally. With a bit of vision eBay could have been the world's auction site - firstish with the mostish. Now, only if they can revert and start up "eBay Classic" is there a hope of getting me (and many others) back and just start again.

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

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

Tue Oct 14 15:38:14 2014

Business 101

It is cheaper and easier to keep existing customers (sellers) than it is to acquire new ones.

MH

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This user has validated their user name. by: baconsdozen
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Sun Dec 28 06:09:36 2014

As the man who built it up to nothing.
Seriously,Ebay must be business most despised by its 'customers' in history.

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