|Wed Mar 11 2009 11:42:03|
EBay Analyst Day Notes
By: David Steiner
EBay is holding it's first Analyst Day in three years today from 8am to 2:30pm PT. While this won't be a "live blogging" effort, we will post any interesting notes that come out of the meeting here, and break it out for further analysis later. Sorry in advance for typos - I'm not the typist in the family...
We'll be updating this blog post during the day, so check back! BTW, all times are ET, where we are. We don't change time zones for anyone. ;-)
Few thoughts in the break:
eBay telegraphed the contents pretty early, so there are no real surprises yet. PayPal is definitely being featured as the "Star" of the portfolio, with the most upside. Look for a PayPal/BML integrated checkout later this year, which eBay hopes will drive incremental purchases. eBay is still a disappointment, so hang on for more changes over the next few years.
I'll take notes for Norrington after the break, but will probably pass up the Skype presentation.
11:15am Mark Rowen VP Investor Relations:
11:20: John Donahoe:
Today we will share with you a different eBay.
Remaking and transforming eBay marketplace
Strengthening position with PayPal
Strong operational discipline
EBay you know is not the eBay we are or the eBay we will become.
We have a strong portfolio in what is still a young ecommerce landscape
We're not here to mimic or follow. Here to lead and innovate
How we're doing:
Paypal has strengthened it's leadership position
Classifieds continue to grow ahead of ecommerce
Skype continues to grow
We are a strong company. However a years ago our core eBay marktplace has not kept up with changing environment and it continues to fall short.
EBay has a storied past, but we have held on to that past for too long.
This morning you'll hear from each of our business units.
What eBay is aobut is connecting buyers and sellers. 10 years ago the ONLY way we connected B&S was with eBay. 7 years ago we bought PayPal. 5 years ago we started a classifieds biz. Over the past few years we bought Shopping.com Stubhub…
…we can best
5 years ago eBay made up 75% of what we do. PayPal was 20% and other was 5%
today eBay makes up roughly 1/2 and FP is roughly 1/2 that. Auctions are still important, but auctions are about 25%
Classifieds rep 1 bill biz
PayPal is roughly a 1/3
Consumer behaviors are shifting online significantly.
When you shop or pay online it's radically different than it was 5-10 years ago.
11:30 How are we positioning our business to win?
PayPal: Not well understood. 3 highlights:
1) PayPal is powering all of ecommerce globally
2) Unmatched advantages. Rides on top of online banking systems & fin services. It's a hybrid which is very hard to replicated. Only payment platform
Second core business for us. PayPla will become THE online payments service.
Leadership position in 39 mkts
Traded 2x volume as the next leading competitor
This marketplace has not kept up. We had to pierce some myths. We've been a victim of our success.
We are not a retailer - we do not aspire to be a retailer. Focusing on the long-tail items, and liquidation (new in-season minus 1)
We're creating the "New" eBay. The pace of change and innovation will be accellerating.
The core eBay mktplce will continue to grow slower than ecommerce in 2009-10, but in 2011 will grow faster.
Wrong about skype connecting buyers and sellers. We're done apologizing for Skype. Great standalone business.
One of the fastest growing businesses in history. Path to realize full value for Skype
3 themes that I'm driving across our company.
1) We're becoming a more customer focused and driven company. Netpromoter is what we're using, and bonuses are tied to it.
2) Unlocking technology.
3) Operating Discipline. Never been a co known for cost management. Acted quickly and decisively in economic downturn.
Summary - this is a different eBay. We connect B&S globally and internationally. Expect in next 3 years? PayPal will become leading payment provider. No paper, no plastic, just Paypal
We will transform the eBay marketplace. We will be A leader in ecommerce, and THE leader in secondary marketplace. Skype will lead a communications revolution.
11:50 Scott Thompson - PayPal
The revolution accepts PayPal.
PayPal bridges Global Financial Network and internet companies
Traditional payment services were built for the offline world. PayPal was built from the ground up for online.
PayPal is like a universal "adapter" for different payment methods online.
It all began with eBay sellers. PayPal allowed sellers to easily accept payments online
Large merchants choose PayPal because it enables them to sell more online.
We will offer later this year the first integrated PayPal/BillMeLater checkout.
Unmatched competitive advantages - more than 10 years experience battling fraudsters.
PayPal has more than 70 mill active accounts and over 3 millions merchants
PayPal grew significantly greater than ecommerce
2011 will process 120bil in transactions (can someone confirm that I heard this #?)
PayPal's take rates are higher on international transactions.
Unique value proposition for merchants. Like PayPal
You can offer promotions that offer BML. The offer appears right on the merchants web site. Proven to drive incremental sales and higher values.
BML offers same peace of mind that PayPal does. BML extends credit 1 transaction at a time, so risk is lower. Credit decisions are made transaction by transaction. BML has managed losses thru the downturn better than other credit providers.
By 2011 PayPal expects take rates to grow to $4-5 billion.
Margins expected to be 18-20% long term.