My 2007 Prediction #3 coming true?
December 19th, 2006 by Robert Yeager
I just read a report that eBay has closed their China website, finally throwing in the towel and admitting defeat in what will surely become the world’s largest Internet market. Is this my 2007 Prediction #3 starting to come true?
Anyway you slice it, this is very bad news for eBay and Meg. You knew with the recent shakeups within the highest levels of eBay that something bad was cooking internally. You can’t do much worse than failing to monetize a huge growth opportunity. eBay was not even charging Chinese sellers any listing fees!
American Internet companies should pay close attention to eBay’s failure. I believe eBay made a huge mistake by not partnering with a strong local Chinese company first before entering the market. Instead, they probably thought their strong “brand” would see them through to success in another foreign market for them.
eBay is a company struggling to find new growth opportunities. You can’t do much worse than failing with your cash cow business division in a new high-growth market opportunity. I am highly skeptical that Skype will ever amount to much in the way of revenue for eBay. Their move to start charging customers to call phones again probably won’t pan out as they hope. Certainly Vonage is already showing that VOIP is no slam dunk with regards to making money.
Usually a large company will go down the paths of acquisition and new market penetration to find sources of revenue growth. eBay has reached dead ends on both counts. They have also pissed off a lot of eBay Store owners by raising fees again earlier this year.
Add to this malaise the ever-present eBay scammers looking to cheat innocent shoppers at every opportunity. Check out this eBay Powerseller who ruined a lot of people’s Christmas this year.
What’s next? Even though eBay is a strong company with a strong brand in many large markets, Wall Street rewards growth. Public companies that don’t continue to grow get crucified, as eBay’s stock has this year. I believe eBay will start looking to merge with another struggling company, perhaps Yahoo!, as both try to renew their growth opportunities together.
3 Responses to “My 2007 Prediction #3 coming true?”
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Evil Bay is doomed. Ever since they dumped me for selling illegal (in California) weapons, I’ve hoped for their downfall. Their problem, among many, is that they set “hard” guidelines…and then enforce them arbitrarily. Personally I’ll be happy when those same 800 Hummel figurines quit flying around the country
I have also been screwed by an eBay powerseller in the past who sold me counterfeit Sony USB memory sticks. PayPal did nothing to help me get my money back.
eBay has always avoided responsibility, trying to take a hands-off approach to the seller/buyer transactions. I don’t agree with this approach.
High-profile auctioneers like Christie’s take great pains to authenticate that a seller’s merchandise is legitimate before agreeing to sell the item. Hell, they frequently pull items from auction if there is even a hint of possible fraud or otherwise with the seller or merchandise.
IMO, eBay should get more involved and certify their sellers…perhaps even certify merchandise if it exceeds a certain dollar amount.
This issue, more than anything else, puts eBay in the “evil” category. They can’t cleanse themselves of the evil perpetrated by their sellers. They are either a force to stop evil, or not. They choose to turn away from responsibility, take the money, and allow evil acts to continue. Shameful.
You can tell eBay is evil b/c they cry about the “hows” of enforcing their community, not whether or not they “should”. This is silly. Auctioneering has been around for a long time…you don’t hear too much about people complaining that auctioneers in general are evil, do you? Just eBay.
Maybe they should work with the iSoldIt and SnappyAuctions franchises as a means to certify sellers and merchandise. Maybe PayPal should serve as an escrow service, as well.
Cooqy’s search engine does have the ability for shoppers to tag good/bad sellers to try to help others…wish I could do more to stop people like the Christmas Grinch I pointed out in my write-up!
Hey, its an interesting research done by you! ebay shud be doomed..