Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Google Inc (GOOG): How eBay Inc (EBAY) Will Double Sales in 3 Years

Page 1 of 2

eBay Inc’s  (NASDAQ:EBAY) stock has been on a tear since the company’s analyst day last week. With one analyst upgrade and several others updating their price target, investors are chomping at the bit to get a piece of the action.

eBay Earnings Report

So what exactly were the magic words that eBay Inc (NASDAQ:EBAY) said at its analyst day to make everyone so excited about the company’s future? Well, for starters the company expects to double its sales over the next three years to $300 billion. But what’s more exciting to analysts, or at least to me, is how eBay actually plans to get there.

Here are some key things the company talked about last week that aren’t getting as much press as the numbers.

Mobile

eBay is taking a mobile first approach. Chief Technology Officer Mark Carges explained, “[Customers] buy twice as much stuff when they use multiple devices.” As online shopping migrates toward mobile devices, eBay is looking to improve the user experience and reduce friction that would prevent shoppers from making purchases.

Additionally, the company demonstrated its new customer-to-customer mobile selling app. The app provides many features that make listing items through a smartphone or tablet significantly easier such as pre-filled descriptions and price guidance.

The goal is to convert eBay Inc (NASDAQ:EBAY) buyers into sellers. Last year, first-time listing increased 67%. Since the eBay flagship website derives most of its revenue from seller fees, the more users it can turn into sellers, the quicker revenue will grow.

The PayPal division, too, is looking to grow through mobile devices. It plans to continue implementing features on its mobile app to reduce customer friction at signup. Its most recent development is allowing users to take a photo of their credit card to sign up for an account. Analyst Michael Graham of Canaccord Genuity seemed genuinely amazed by how simple the process is and how convenient the PayPal service is.

Local

eBay is also looking to extend its mobile reach to a local level. Aside from continuing to roll out partnerships with brick-and-mortar stores to allow customers to pay for goods using PayPal, it’s taking further steps to make the local shopping experience faster and more convenient.

eBay shoppers in select metropolitan areas will soon be able to use a new service called eBay Now. The service provides same-day (usually 1-hour) shipping for goods sold at local stores like Target and Macy’s for $5. The service uses the GPS on users’ phones to find where to deliver the items, creating even less friction for the customer.

eBay Inc (NASDAQ:EBAY) Now faces competition from Google Inc (NASDAQ:GOOG)’s new Shopping Express service, which it’s starting in San Francisco. Google’s and eBay’s valet shipping services have a lot of overlap, but the pricing structure differs. Google Inc (NASDAQ:GOOG) plans to charge $79 annually, so unless customers make more than 16 orders per year, eBay Now provides a better value. eBay also sports the first mover advantage, and will soon be available in Chicago and Dallas well before Google Inc (NASDAQ:GOOG).

eBay recognizes that 90% of shopping occurs offline, and 75% happens 15 miles from one’s home. eBay plans to leverage its RedLaser mobile app, which allows users to scan barcodes and browse information about products, to make the in-store and local shopping experience better for its users.

RedLaser could be used to tell users what aisle a product is located on, and if another store has a better price. eBay is simply looking to engage its users. Providing users with helpful information, will also provide eBay with some useful shopping data it can use for its operations.

Page 1 of 2
Loading Comments...