Key Takeaways from eBay's 2Q15 Results

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Part 9
Key Takeaways from eBay's 2Q15 Results PART 9 OF 10

What Are eBay’s New Initiatives to Generate Growth?

Ebay’s measures to instigate growth

eBay’s (EBAY) management is taking a series of measures to generate growth in its Marketplaces segment again. These measures include revamped search and product pages and more structured product listings in catalogs.

What Are eBay&#8217;s New Initiatives to Generate Growth?

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The company is focusing on key customer segments and deal categories. It has rolled out some new initiatives. The objective is to improve the consumer experience across various products and diversify traffic sources on social platforms like Facebook (FB), Pinterest, Instagram, and Snapchat.

eBay has also released its Apple Watch app for the online marketplace to focus on mobile. This app enables users with a snapshot of notifications and items they’re bidding on, selling, and viewing.

eBay’s major rival is Amazon (AMZN). It also launched its Apple Watch app early in April.

Will eBay launch a program similar to Amazon Prime?

The rising popularity of Amazon’s Prime program prompted eBay to launch a similar program. According to a report from the Wall Street Journal citing local press in Germany (EWG), eBay could be testing the same-day delivery program in Germany. This is similar to what Amazon offers through its Prime program. This program will be called the “eBay+” program. Customers will have to pay about $17–$22 per year.

eBay is taking this initiative due to the rise in the demand for the same-day delivery of products. Consumers demand instant gratification while shopping online—regardless of high shipping costs. According to a report from Business Insider’s BI Intelligence research service, and as the above chart shows, the US same-day delivery market could grow from $0.10 billion in 2014 to $4.03 billion in 2018 at a CAGR (compound annual growth rate) of 150%.

eBay offered faster deliveries through other innovative means

This will be a change of strategy for eBay. Until now, it hasn’t considered the same-day delivery of products to be essential. eBay has been serving its customers with faster deliveries through other innovative means.

eBay has partnered with Argos stores in the United Kingdom. Through this partnership, goods sold by eBay’s merchants online will be available for customers to pick up immediately at Argos stores. Similarly, Google (GOOG) offers the Google Express service. It’s a same-day shopping service for orders that consumers place online from retail stores like Staples (SPLS) and Walgreens (WAG).


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