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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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by: toyman This user has validated their user name.

Tue Sep 30 12:04:28 2014

Excellent summary, David. We can only hope that Wenig is NOT a Donahoe worshiper or is NOT afraid to make ''roll back'' type changes.

One thing we can do is for everyone on this blog to share this article across social media, Facebook, Twitter (link), Blogs, etc. get it out in as many places as possible and HOPE that some influential eyes pick up on it.  

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This user has validated their user name. by: Marie

Tue Sep 30 12:04:49 2014

A very nice job indeed David.

Sometimes with the head of a large company is being replaced and there is such a long lead time before he is actually gone there is a function that they need him to fulfill or a contractual requirement the company is being held to.  

Sometimes when something like this happens, while for all appearances JD is in charge, but in reality he isn't.  Since his successor has already been named so far in advance, chances are good that his influence will be felt long before JD actually leaves.

Companies don't typically name a successor this far in advance unless there is a reason to do so.  

I hope that some relief for sellers is felt soon.  To me the most important things at this very moment is the search and traffic.  I've never had my sales so low.  And it took a nose dive late February and has not recovered.  This needs immediate attention and some resolution.

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by: BackInBlack This user has validated their user name.

Tue Sep 30 12:19:47 2014

♪♫ Ding Dong! The Wicked Witch is dead. ♪♫

That being said, I believe the Good Ship eBay has already taken on too much water and is half capsized.  Not sure it can be fixed at this point.  As the article says, they kept JD around and stuck by him TOO LONG.

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This user has validated their user name. by: Mercy the Mingless

Tue Sep 30 12:22:58 2014

Brian Burke next.

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This user has validated their user name. by: thehosst

Tue Sep 30 12:23:47 2014

Do you think that Marketplace Most Dangerous Killer Donahoe cares about what we think? He is happy he screwed every small seller and that soon will join Alibaba. He made all the cash, twice and will be making lots more but he will never be able to see anyone in the eye, after, together with Google, killing the internet business model

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by: nothingnew This user has validated their user name.
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Tue Sep 30 12:24:43 2014

TO LITTLE TO L A T E! I dont care if the monkey is running ebay I'M ONE with that s**t hole site!

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by: nothingnew This user has validated their user name.

Tue Sep 30 12:25:10 2014

Done even  

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by: jaja This user has validated their user name.

Tue Sep 30 12:39:29 2014

Ever since this KNUCKLE HEAD took over, I knew it would be a disaster! the required changes from sellers are constant, and are clearly example of idiocy. I have been selling at ebay for over 15 years, and for the past 2 months , I had more false cases and negative feedback received, for the past 2 years alone. So many false cases, that I wonder how a seller can survive. I had a case today as "ITEM NOT AS DESCRIBED" when the tracking number shows still being sorted at local USPS facility, I am located in MA and buyer in IN. Matter of fact, this is the 3rd such case in 45 days. When I call ebay, they say: "sorry, we can not do anything to help you because the case is still open". It is like: "go to hell seller, we don't care about you being honest, we only care about giving your hard earned money back to these scamers AND they can keep the item"

Believe me people, I receive a new case as NAD every 2 days. GTC items which have been selling for many years, same description, over thousands of sales per item...go figure.  Good old Meg Whitman days, please come back!  

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by: RCL This user has validated their user name.

Tue Sep 30 12:50:15 2014

Oversee the split? There's no way that is really going to happen. He will be using his office to find another position. I don't think ANY eBay CEO is going to give a hoot about ''small sellers'', though. Even before the brand names took precedence, we were only about 16% of gross revenue weren't we? That's lunch money for eBay.

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by: RCL This user has validated their user name.

Tue Sep 30 12:52:04 2014

I think eBay had gross revenue last year of 4 billion.

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by: LightWing This user has validated their user name.

Tue Sep 30 12:58:14 2014

Remembered?

Draconian, abusive to the sellers who "brought ebay to the party" and completely out of touch with the needs and concerns of sellers while ass kissing Wall Street and shareholders.

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by: Red Ink Diary This user has validated their user name.

Tue Sep 30 13:04:40 2014

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

With regret, it was great and he broke it.

Maybe, after he's gone I will buy there again, assuming there is anything left I would want to buy.

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This user has validated their user name. by: Rexford

Tue Sep 30 13:06:34 2014

Well written David.  And I am in agreement with every word of it.

Now if Weinig will only have the good sense to read it and ABSORB it.  

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This user has validated their user name. by: Marie

Tue Sep 30 13:15:22 2014

@RCL

In 2013 the Gross sales was closer to 11B.  Net profit was about 3B

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by: steveylang This user has validated their user name.

Tue Sep 30 13:18:07 2014

I give Donahoe 1 star DSR's across the board!! I might even file a SNAD on him-

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This user has validated their user name. by: Rexford

Tue Sep 30 13:22:32 2014

In my opinion he first took the fun out of eBay and then he destroyed it, and he destroyed a lot of small sellers' livelihoods.  I view him as a despicable and detached human being who is driven by greed. Good riddance.  

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by: Moonwishes This user has validated their user name.
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Tue Sep 30 13:29:20 2014

>>Likewise, you can continue to count on everything you expect from eBay today. <<

Those are scarey words. How much damage can he do before he is gone. He may be a figurehead for the next year, but remember he will still be on the Board of Directors so I would suppose that he will be heard on some issues. Why look for a job. He has made plenty enough that financially he should be able to buy anything and everything he and his family wants, unlike most ebay sellers. I left ebay years ago and I rejoice for those of you who have stuck it out and hope for your sakes that things don't get worse.

How will he be remembered? By sellers as a greedy pig that only wanted fist fulls of dollars and time to think at what $100K a minute or some ridiculaous amount. I would glad to sit and think for that much money. Have no idea what those days of thinking ended up doing his company much good though.

My media reports as this savvy business man. Those he has stung and abused need to keep the documented evidence for when someone is willing to write the real truth about eBay and the corporate disasters of Meg and JD as they turned a fun and profitable company into a disaster.

Here are some potential titles "The Ebay Disaster". "How to ruin a Multi-billion dollar company in 10 easy steps" "Thinking Your way to eBay's destruction"

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This user has validated their user name. by: shabbychick

Tue Sep 30 13:30:42 2014

Perfect summation!  May it go viral over the interweb!

I would just like to add one other suggestion to whomever winds up at the helm:  When will someone over there wake up and  get rid of  this Cassini (can’t see me) search engine?  We spent 15 years learning how to search at Ebay for exactly what we want.  It worked flawlessly. With this NEW search engine we can no longer search or find anything we are looking for!  It is absurd in its answers.  All one of the brainiacs over there has to do is attempt to search for something to see the problem. Try the old engine then try the new and see the difference.

My techie son tells me “computers don’t make errors, they are usually carbon based  (human ) errors'', as in  “ the computer is screwing up!”....”No mom, it’s a carbon based error “ (ie me).   Cassini is one carbon based error after the other.  Let the normal search parameters work normally.  And at you too, Etsy.

I’ll go away quietly now….

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by: mastoyshop This user has validated their user name.

Tue Sep 30 13:35:28 2014

Hello... Dont any of you read the FINE print.. He will remain on the Board of Directors.. yep.. so he isnt really 'going' anywhere.
He will probably still make 1mil a year and he certainly has a nest egg off our backs just like MW.
He better never run for office anywhere.. lol

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This user has validated their user name. by: Ed Gadfly

Tue Sep 30 13:36:21 2014

JD is not gone yet.

http://www.geekwire.com/2014/ebay-spin-paypal-2015-ceo-john-do
nahoe-stepping/

According
to this article JD will help with the formation of the two new companies. I don't think they are taking away his parking pass yet. Do you think John will show you love or act for the best interests of the shareholders before he flees?

People used to dislike Bill Cobb and figure anyone else could be better. Keep an eye out for Bain connections with the new Leader.

An ancient curse is, "May you live in interesting times." Let's see who is still standing in 2015. You have to survive Christmas. Nobody said the oppressive rules would ease up. Your new boss needs to make a reputation for themself.

They ought to make Uncle Griff the new CEO. He has sold on eBay and looks good in a Skipper cap.

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