EcommerceBytes-NewsFlash, Number 2123 - September 23, 2009     1 of 5

eBay Is Not a Retailer, CEO John Donahoe Tells Attendees

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eBay CEO John Donahoe told attendees at this morning's Summit that eBay is not a retailer, and will never be a retailer. He is not concerned about competing marketplaces such as and Wal-Mart, which recently opened its online platform to third party sellers, pointing out that both companies compete with their third-party merchants.

When asked about the upcoming holiday shopping season, he said eBay has seen stabilization and is cautiously optimistic about the upcoming holiday shopping season. He believes there is a lot of growth in online retail, with the potential to reach15 - 20 % of offline retail.

Mr. Donahoe also said there are still synergies between PayPal and eBay, but said, "If and when I feel the businesses are better off separately, we'll do what we did with Skype." He was dismissive of the legal troubles eBay is having with Skype's original founders.

Mobile Trends and Innovation
While traditionally there was a delineation between the online world versus offline world, in the eyes of the consumer today, those lines are blurring. Mobile devices will play a very important role and will have a big impact on shopping, eBay's CEO said.

Mr. Donahoe said eBay wants to be the iPhone of ecommerce - a platform on which many applications are built by third-parties - in order to accelerate innovation. He used the example of TwitPay, a service that allows users to send money to Twitter users via PayPal using their mobile devices, and he demonstrated by sending $10 to an eBay developer in the audience.

eBay Is an Online Outlet Mall
Patti Freeman Evans, Vice President and Research Director at Forrester Research, conducted a question-and-answer session with the CEO after his presentation. He said that one of eBay's challenges is its unstructured data - only 10 - 12 percent is catalog. But he said eBay is embracing the wisdom of community - "We will have community generated catalogs, to help in tagging items."

eBay buyers want access to what the larger retailers are selling, and eBay can provide that - but one season old, or returns, or liquidation, Donahoe said. eBay is the online outlet mall with a focus on the secondary market. "eBay is a marketplace not a retailer, and will work with many of you, large and small, to be an effective channel," he told the retailers in the audience.

As for PayPal, Mr. Donahoe said it reduces the pain point of ecommerce, which will help ecommerce grow.

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About the author:

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). Follow her on Twitter at @ecommercebytes and send news tips to

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