Company aims to improve trust in the marketplace, fine-tune its technology platform, and increase seller standards
In a reprise of his pledge to change a little over a year ago, eBay CEO John Donahoe reiterated on Wednesday that the company must adapt to new e-commerce market dynamics and must be more hands-on in managing its online marketplace.
Under increasing pressure from rivals like Amazon.com, eBay has seen its dominance in e-commerce diminished in recent years, as both buyers and merchants seek new alternatives in online shopping.
In 2008's fourth quarter, the Marketplaces unit saw its revenue decline 16 percent, compared with the same quarter in 2007, while gross merchandise volume declined 12 percent. Unique monthly users also dropped year-on-year.
eBay began strictly as an online auction site but has since become more diversified, allowing the sale of fixed-price items and letting merchants open "stores."
It also got into the online payments business with its acquisition of PayPal, which generates about one-third of the company's revenue, and into Internet telephony with Skype.
eBay will also focus on providing a wider variety of shopping "formats," beyond auction items, fixed-priced products, and classifieds, for a variety of devices.
The changes will take some time to be implemented and to have an effect, so eBay's growth will likely lag the overall e-commerce market this year, he said. By 2011, however, the eBay marketplace will outpace the market's growth.
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