Editor’s note: This is a guest post by Keith Rabois, vice president of strategy and business development for Slide, the social entertainment company. Prior to Slide, Keith was a VP at LinkedIn and an EVP at PayPal in charge of among other things, competitive strategy vis-à-vis eBay. He also worked at eBay for three weeks following its acquisition of PayPal. Keith currently serves on the Board of Directors of Yelp, Vendio, Xoom and FanIQ.
On Monday afternoon, I was speaking on a panel at the Social Graph Symposium when the moderator asked me what eBay could do to revitalize its marketplace by leveraging the social graph. Dave McClure, like many pundits, presumes the social graph could be a great boost for eBay, if not an outright panacea. I replied, “nothing.”
It’s actually the social graph and similar products that have placed a stake in eBay.com. Most often, people blame eBay’s decay on factors like the weakening economy, the rise of Amazon, as well as eBay’s own inefficient search functionality. But the real and simple reason is eBay is no longer fun. Over the years, it has lost online ground and eyeballs to pure entertainment destinations such as YouTube and social networking sites like MySpace and Facebook.
Do It eBay
Although it was always classified as an e-commerce destination, the quirkiness of the eBay marketplace was once a major source of entertainment on the Web. It was where people sought and bought everything from the first broken laser pointer to Beanie Babies to Bob Dylan’s boyhood home. While the catch—anything from an antique clock to a Gulfstream II—was rewarding for the buyer, it was generally the entertainment and excitement of the chase that brought a buyer to eBay in the first place.
When eBay launched its first U.S. advertising campaign in 2000, eBay spokesman Kevin Pursglove stated, “We hope they [the ads] reflect the fun that people have when they come to our site.” According to USA Today, “the fun aspect of eBay seems to have struck a chord with consumers.” At that time, eBay was downright addictive and when you won an auction, it was thrilling. That delight kept people coming back for more, whether or not they actually prevailed with their bids.
Almost half the U.S. Internet population
Let’s rewind to 2004, just a short five years ago. In January 2004, almost 50 percent of the entire U.S. Internet population visited eBay each month. If people were bored at work, chances are they were surfing the pages of eBay and unearthing eccentric auction items they never even knew existed. This was the height of the eBay heyday.
So what happened?
With the fun factor driving eBay usage, what really stole eBay’s limelight was the rise of social networking sites such as MySpace and Facebook and the likes of YouTube. In December 2006, almost half of the U.S. Internet population was still visiting eBay. But when you examine the total amount of time spent online, 11.9 percent was spent on MySpace versus 3.7 percent on eBay (according to Compete.com). By then, people were already devoting more of their online time to pimping out their MySpace profiles or snacking on YouTube’s videos.
To add further insult to injury, in early 2007, Facebook opened up its platform and ushered in a flood of new applications. The result was the introduction of even more entertainment options to consume your online hours. People began to swap the enjoyment of serendipitously discovering knick-knacks on eBay for watching people run into trees on YouTube or SuperPoking friends on Facebook. The eBay addiction was replaced with other, more entertaining addictions.
eBay strips out the fun
This was not lost on all of eBay. As early as 2006, several executives championed an internal effort dubbed “eBay 3.0.” The new vision for eBay was to resurrect the “fun” of auctions. An ad campaign labeled “Windorphins” was meant to remind consumers of the endorphin rush experienced when winning an auction. The purchase of StumbleUpon even had a rationale in this model. The ideals fueling eBay 3.0 eventually fizzled.
By the time John Donahoe took the helm of eBay in Q1 2008, he opted to “aggressively change our product, our customer approach and our business model.” In a futile effort to compete with Amazon and Google, eBay leadership essentially stripped whatever remaining fun existed out of its marketplace. In December 2008, eBay’s visitors accounted for only 1.5 percent of total minutes spent online (according to comScore Media Metrix). The leader board for top online properties showed Google, home of YouTube.com, and Fox Interactive Media, which includes MySpace.com, in the top five. EBay ranked sixth in total unique visitors, but was also the only property on the top 10 list to see a decline from 2007.
Where did all the fun go?
Ironically, at one point right after it bought PayPal, eBay had the leading actors of most of this entertainment revolution sitting in its offices. Chad Hurley and Steve Chen of YouTube fame, Peter Thiel (Facebook), Jeremy Stoppelman (Yelp), Max Levchin (Slide), David Sacks (Geni and Yammer), Reid Hoffman (LinkedIn, board member of Zynga) and others, myself included, were all too alienated by eBay’s bureaucratic and political MBA culture. So we decided to create our own fun elsewhere instead.
eBay is an ecommerce website. I remember when sellers were having fun with shipping costs that were 20 times the cost of the item and getting away with it.
I was a power seller on ebay for over a year.
I am also glad eBay got rid of the bidder name to avoid undue attention.
GaryCool is now listed as G******l in the auction bid listing.
Every time ebay changes it’s interface, I am like WTF, and it pisses me off.
Scores of tools are built around the site as it is now, and many people rely on it for eCommerce.
Changing the formula for a profitable business in a time of economic recession, even though it is at it’s tail is suicide.
eBay shifted to a model of maximum privacy, and as an eCommerce site, I believe it should remain that way.
Doing stuff such as youtube does, listing the referrer pages to an auction, such as youtube does with video, and building user defined auction channels would be a bad idea.
Again, it’s an ecommerce website.
I agree.
I do agree that ebay is an ecommerce site, they started their decline with the emergence of buy it now auctions, which basically killed the fun of an “auction” out of the picture effectively turning it into a psuedo-amazon site. Also with the emergence of these padded seaerchs on ebay where a seller will auction make money cd’s or scams and pad their auctions with every word possible to elicit hits upon searches. I believe this was where the decline came from not neccessarily the emergennce of the soci networking sites came in. I never thought of ebay as a platform other than ecommerce. I don’t know that’s just me
Oh, I forgot about the “how is this guy credible” factor
http://feedback...;userid=necro25
“hello TCrunch readers”
In my first feedback. I was a Powerseller in 2008.
“Member since: Feb-08-00 in United States”
There’s the weight to my comments.
Keith forgot to mention the contribution of Craiglist rise, as a new online channel to sell, to the decline of eBay
god point, I’ve used craigslist 100’s of times, ebay only a few times.
I agree, website maybe have a 5 year popularity peak, and then the next cool new thing comes along. There are just a lot more fun, social networky websites out there. Maybe E-bay can acquire or partner with a social network to enhance its sales.
Agree that the rise of Craigslist greatly affected eBay!
Many eBay consignment sellers prefer Craigslist for large items because they can require cash for local pick up.
Just today I went with a neighbor to pick up some free moving boxes advertised on Craisglist which still offers the thrill of the hunt.
They only changed the S&H because sellers found a loophole in eBay’s fee system. If you sold a $20 item for $1 and charged $24 shipping…even though it only cost $5 to ship it, you auction ending fee would be based on $1, not $25 (S&H wasn’t included in it).
eBay never does anything for the end user. Half of the fun of using eBay long ago was finding the loopholes and gray areas of the service to get the most bang for your buck. Now, it’s like shopping on any ol’ website. Sometimes fun, most times not.
eBay died when they implemented the “buy now” feature.
Everyone puts it on what they’re willing to sell, but then claim “no reserve”. If there is no reserve, then why have a “buy now”? THAT is your reserve.
That, and getting double-billed (ebay’s fees, plus ebay-owned Paypal percentage), and it goes to suckage.
I agree with “josh”, I do a lot of buisness on ebay and their fees do seem a little excessive. That may be part of the reason for their downfall.
The article here leads no where, would have expected more since it is here on TechCrunch.
However a great topic to discuss. Firstly, Facebook, Myspace or Youtube did not kill Ebay; Ebay killed (read ‘is killing’) itself.
1. In early 2000 the number of ecommerce sites were less, naturally Ebay lead the bunch with its auction model, while Amazon went ahead with Buy Now.
2. Infact Ebay was an pioneer of social shopping – it connected buyers to sellers. But Ebay, nor anyone else did realise that there is something “Social” about Ebay.
3. Over years other internet engagement models developed – for social networking (Facebook, Myspace, etc) and social buying (Recommendations on Amazon). Everyone, but Ebay worked on different social components to propel growth – but Ebay didnt realise the way ahead in this.
4. As a result, users migrated to more social platforms where average time spent on these platforms increased. Ebay did not come up with any social engagement model- thereby reducing Ebay’s share.
5. When it came to Buying Online – consumers preferred Amazon over Ebay because of a.) Fulfillment was less time consuming compared to Ebay where the time-spent to buy an item was very high due to bidding process (with no guarantee that users will be able to successful win the bid). b.) Amazon made its name with books (one of the largest verticals on the web). c.) Social Recommendations (that Ebay could not provide)
6. Ebay finally moved to “Buy Now” model but by the time it did, it lost its ground.
7. Ebay wanted to grow, but didnt knew how and where – leading them to acquire Skype, Stumbleupon that did not strategically fit its core domain.
Ebay instead of spending time on its core eCommerce platform, spent more time on thinking to make these acquistions fit in its portfolio.
Well i love the article and i agree with your observation.But i think we need more fun now and go back to maybe more traditional ways than to hide behind a keyboard.
Telesocializing is here its new and fresh. I think these young kids form UM have something here
http://www.bueno.com
http://www.twibeo.com is a twitter that enables photo and video sharing. Check it out.
It’s been said a million times already, but whatever, what’s one more….TechCrunch, you’re giong to have to start moderating these boards. Pretty soon it’ll be all viagra and penis enlargement spam.
I just hate those crappy non researched articles.. without any foundation.
First they are all in different markets so comparing apples with oranges wont work. If you’d have looked at the demographics and invested 2min on alexa… you d have noticed that ebay serves entirely different demographics then your social networking sites.
I am sick and tired of those blog posts by dudes who can’t even invest 2min of research. Please techcrunch hire one of the million of journalists who want to journalism school who at least have a basic clue about how to write an article.
But this stuff is simply crap.
Too right. An unclear, unsupported thesis… this article is just a waste of space. Doesn’t TC edit its celebrity posts?
Fully agree…
He’s a celebrity?
Agreed… Why didn’t he even mention Craigslist?
Because Craiglist is not “cool” in the eyes of the Valley crowd.
Because it’s not really a true competitor/alternative to eBay. eBay’s buyer/seller relationship was based on trust and community support/involvement…Craigslist is just a glorified classified listing site. Nothing protects the buyer/seller from potentially being screwed over.
No Craigslist it a direct competitor to eBay unlike MySpace and Facebook that are referenced int he article for some reason.
Anyways the downfall of ebay is the monopoly it has with Paypal. Once you getting bitten by paypal as many have by now it leaves a real bad taste in your mouth.
Craiglist is the most direct competitor to eBay versus any of the sites in the author’s list, especially for bigger items that cost too much to ship. If you are in the US, then you are most likely to visit Craiglist and drive to where you’ll pay somebody directly for something. Besides, what’s more social than meeting the vendor in person?
Come on if craigslist din’t have the erotic section they would be nowere.Do not compare these companies to that site.
Don’t mistake the marketing people for Silicon Valley – the whole place runs on Craigslist. This is YAMP – Yet Another Marketing Person. Count yourself lucky this isn’t another powerpoint presentation. 3 weeks with ebay then they cut him loose. Can you spell ‘bitter and twisted’?
Totally agree. I expect TechCrunch to do a certain level of vetting on its articles’ authors and content.
Keith’s lack of addressing Amazon’s continued success within ecommerce is convenient.
It’s very telling of his lack of understanding the users. He not only assumes the users are the same today as they were in eBay’s golden days, he also assumes they behave the same with assimilated goals, pain points, and motivations.
In the time Keith Rabbois saves dismissing learning from the users, I’d expect him to use it in researching his public hypotheses.
Keith hit the nail on the head!
For whatever the reasons (e.g. all those Keith mentioned, plus those that others astutely pointed to here as well), the fun has gone out of Ebay; and this happened well before our various national economies turned bad.
Ebay gradually stopped being a fun place to sell or to buy. And the hemorrhage of sellers as well as decreasing interest from buyers – which have become a matter of public record – took a quantum leap forward as of 2008.
Indeed, Keith’s reasoned observation that Ebay stopped being fun unfortunately is an understatement.
Not only isn’t Ebay fun anymore, but it has become a source of frustration, irritation and anger… A fact confirmed by the “red hot” comments rife on Internet forums, following articles and even on Twitter, just to name a few.
In fact, with all the “bad press” and poor performance reports Ebay has received, anyone not aware of Ebay’s failures must be spending all their time on Ebay… without ever reading the discussion boards in Ebay Community!
I hate comments like this by tools who don’t have 2 neurons to rub together…
It’s a good post with all evidence is being put together nicely. But I doubt they kill eBay in any way although eBay is dying somehow. The main cause that slows down eBay’s growth (low transactions) is the economic recession. People don’t want to spend money on secondary needs. That’s all.
You would have thought ebay would do good in a recession… second hand goods low price etc.., there is somthing in this article that reflec’s the fact that ebay is having a bad time of it.
Techcrunch; what about alibaba.com there smashing it right know.
Evidence? What evidence and about what?
Ebay is still doing well as you can see at http://investor...ial_history.cfm
Techcrunch is writing about the success of ebay at keeping people visiting their site but I’d rather write about their success at making money. Apparently they’re losing visits to more fun destinations (I’m not surprised) but people keeps buying and selling goods as much as in the past, bad economy notwithstanding. Actually this might be good news for ebay, which gets more money per click than it used to do in the past years. More money, less costs.
Thumb up for ebay, thumb down for TC.
Not to sound to harsh, but did you guys even read the article?
The point is that ebay is not ecommerce. It *was* entertainment with ecommerce as the vehicle, and this was the source of its success. They lost the fun/entertainment factor and now they’re just an ecommerce site…one of bazillions.
The more they focus on ecommerce, the more they’ll be another also-ran.
Yes, but this was also when computer were thrill to use, the fact that buying something like that on a computer was amazing. Now ebay is part of everyday life.
You can’t compare ebay to websites like youtube and myspace of course people are going to spend more time on them, there is more to do.
I don’t think ebay has lost the fun/entertainment factor I think computers have lost the fun/entertainment factor.
“this was also when computer were thrill to use” 2004? What are you, new? eBay blows now; it’s full of shitty pro stores. eBay actually was a great site to spend time on in 2000 or 2002. It was a form of entertainment. Do you remember the spate of people who sold items that they had photographed in the nude and you could barely make out their reflections? Hilarious. Anyway, short form: you’re wrong about that.
Kubrick–you are a sad and bitter person and obviously someone who thinks that a name like “Kubrick” makes them “hip”. Take a deep breath, drop the narcissistic attitude and TRY to write something intelligent.
I agree with Mike. EBay needed to create community and conversation with its buyers the true customer base not focus on managing and controlling its sellers. Amazon is much more of a community, a conversation and a social network. I think Meg Whitman ran EBay like an online garage sale without out the lemonaide stand, baloons, and nutty sale signs. It just got boring. During a recession people would want to buy on the cheap even more but Amazon and Overstock.com are far more enticing now.
And this woman is running for governor.
Yes I did.. the problem with those articles is.. they are not substantiated. They are crap. If u go out and take multi million user site like ebay and proclaim its all about fun and use one add commercial to support your claim.. it’s just BS.
At the end its statistics.. and with a mio user you got a normal distribution where for some its fun, for others its this. However taking a look at demographics gives you a much better idea what it is about then at 1 commercial or a marketing strategy for that matter.
Fact is he puts some brain fart out there, without any solid research. And the moment you go and dive a bit deeper you realize how much garbage this post is.
Seriously please hire some guy that went to journalism school, someone that can do some basic research, instead of some celebrity due who is blogging about his latest brain fart…
This article is unsubstantiated, just like your comment. It’s an opinion piece. If you don’t agree with it, then try making a cogent counter-argument rather than showing everyone what a dolt you are. Also, pro-tip: there are other sites on the internet.
Dude.. if you read my article.. a few comments up I brought out the facts long time ago. Go to alexa.com pull up the demographics of the sites this douchebag is comparing, and you’ll realize how off the charts he is.
yes it is an opinion piece but it still is garbage. Using slides that are 3 years old, it is an insult to most t$ readers.
So why don’t you pull you head out of your ass and read my comments right so you don’t annoy us with your crap. And read the FUCKlNG comments before making a fool of yourself… idiot.
Dude mike, question did u think first?
Questions, where’s the Fun/entertainment in Craig’s list and why it’s so popular?
Craig’s list and other Classifieds sites that killing ebay and the damn Fees!
Nice headline – “How Facebook, MySpace and YouTube Killed eBay”, but I’m not convinced. Did Facebook, MySpace and YouTube also kill Amazon? ebay has been around since the Web started, it’s a proven business. Facebook, Myspace are not proven and in 5 years they may not be around. I could be wrong. Naaa.
Ebay treats their sellers like criminals now too. That sure doesn’t help
I agree. To have multiple eBay IDs (all with 100% FB and in good standing) along with an impeccable 8 yr old PayPal account, and to suddenly have my funds held until the Buyer leaves positive Feedback (or delivery confirmation is provided to PayPal – from either end) is complete and utter B.S. The reason: eBay/PayPal decided (through some mysterious criteria) that the commodity being sold is high risk/high fraud/etc. Their answer: each eBay ID must have min 100 FB to remedy this. The solution: invoice the Buyer for ‘Goods’ from PayPal directly (not via ebay checkout) …but what a pain in the a$$.
That’s exactly what they DON’T want to do, because then PayPal would become an escrow.
Yep. You can’t make ANY kind of references to any off-ebay websites (like your online store, an info page, etc) or you’ll have your auctions pulled. They stopped letting sellers accept non-PayPal payments (talk about monopolizing the system!), and pulled all auctions (even if they had bids) if you made one single mention of “alternative payment methods”.
The buyer and seller is punished if they want use checks or money orders to pay by mail or other alternatives like by credit card.
eBay used to be fun because it used to be friendly.
Just remember – eBay is self-policing; in short, it needs its members to ‘tattle’ on each other. There are methods to ‘legitimately’ funnel people away from ebay, by using your eBay-provided, AboutMe page, (and providing direct links to your AboutMe page throughout your auction’s description). Investigate works by Andrew Lock.
I got my auction cancelled because I described something which was like new ‘like new’ and was accused of keyword spamming.
people liked ebay because people made money via auctions and buyers found bargins. sure shopping can be entertainment. but it was about making money that was the allure. and stop with the social graph sh8t.
Ebay is great for comics and video games.
What’s the difference between eBay and myspace, facebook, slide, YouTube ?
eBay makes a PROFIT like a REAL company.
Sure it’s not as sexy as twitter or whatever web 2.0 crap TC is pushing this week. It would be nice if there were more of a focus on real sustainable companies out there. Give me a break slide is a joke
You forgot, ebay makes other people money.
Which is why eBay is cool. eBay and Amazon 3rd party sellers provided a great marketplace for anybody to sell new or used products.
No company in the past 10 years has been able to do that.
As bad as Microsoft is, they let people sell stuff in their XBox marketplace, so that is something good too.
http://www.yout...h?v=W0Hl0tLs7XA
My video on socal linux expo youtube video got 52,000 hits. What did I get for it? Nothing.
Sure it’s fun, but it’s also pointless from a monetization stand point. People that put a lot of time and effort into something want to see money. People that buy want to see low, low prices.
That’s what it boils down to. Imagine a “fun” version of Ameritrade or Scott trade, where you get http referrers to pages with your trades on them.
There has to be a line in the sand between social stuff and eCommerce for the trust to be there.
An insightful post and one I welcome with open arms to my time spent reading on the web. I love this type of post to break up the coverage of Twitter, new web apps/services/companies and the like and I think this type of post adds to the brilliant modern day diversity of tech news that TechCrunch offers to its readers.
Keith Rabois, Michael Arrington – hats off to you both.
The novelty of eBay wore off, that is true…but the Facebook, Myspace etc. of the world are not the demise of eBay. I would venture to guess Amazon and Craigslist have far more to do with it than social networks. Some real data would have been nice.
Personal example: I once tried to sell 12 comps via eBay and the process was so cumbersome and expensive it was hardly worth it…Long story short, I ended the auction, put them on Craigslist (for free) and had all sold to a local person in less than 24 hrs. Craigslist simply worked better at a lower cost…I wasn’t distracted by Myspace or something else.
you’ve got it right.
also i can’t believe a person who is a VP of strat. at slide would write something like this.
Guys, it’s very simple. The difference between a bulletin board like CL and an auction house would be:
1. Verification of the seller and merchandise by the AH.
2. Escrow service for the transaction.
In the early day eBay SOUNDED like a company that WILL provide 1. and 2. some day. They just didn’t deliver on this promise, that’s all. Instead of working they started baning and treating everybody as fraudsters (because they failed to BUILD an effective anti-fraud automation, they only kept adding legalese to their End User Agreement instead).
That’s it.
Posting data a graph from 2006 showing Myspace as #1 is hardly going to be accurate anymore. Facebook, Twitter will have grown in popularity significantly.
Let’s not forget the rise in popularity of Kijiji and also Craig’s list. If I can buy or sell something locally then I will. Kijiji is free and it works. So unless I am trying to make money off “Toast in the shape of Jesus”, I am not posting to E-Bay first. Seriously though, E-Bay has some competition but their moves to protect privacy have been good ones in my opinion and things may have slowed for them but they have hardly been killed.
Bloggers please practice some journalism and fact check please…
The post has many holes
fully agree… this non quality bullshit starts to piss me off. Please… it would have taken 2min on alexa.. instead of recycling some 3 year old slides and throw out some brain fart.
I personally think the guy is an idiot.
But I personally think you’re an idiot, so I think that makes me a fan of his.
Uhh, it’s accurate for 2006, which was the point. Maybe you didn’t RTFA.
Scams and jacked up fees killed ebay.
murderers rip off artists, con men and thieves may kill Craigslist. I am truly scared to sell anything on it
This is good stuff (the discussion I mean). Don’t about the fun stuff that the article’s thesis is built around but I do agree that there is a whole lot of chatter on twitter with people complaining bitterly about the fee structure, especially the final valuation fees. Don’t know if you have heard of Joel Sauceda but he crafted this new company for online listing of especially big ticket items specifically to benefit from the recession and specifically because he knew that the final valuation fees were a sore point, so in big ticket depot and big value depot there are no final valuation fees, and the 300 elite founders are given 100 free listing codes each month that they can use to list their own items or to benefactor other listers. I think he may be on to something here. have a look: http://simurl.com/bigticket
I think on the ecommerce angle, so many people have been bitten by a bad eBay transaction, that their first outlet is now craigslist for anything “real” they have to sell… And has been mentioned, the ’seriousification’ and profit-focus/new rules that hit sellers harder all work to prevent the old ‘fun’ auctions that served as entertainment.
So, I’d say if he adds craigslist to the list, then it’s pretty accurate in terms of the sources of traffic loss… But the entertainment theory is still a little shaky. I myself only ever used eBay to find deals on things I wanted/needed.
It was eBay that killed eBay.
They added “merchants” and “powersellers” who flooded listings with trash that was endlessly and automatically relisted after it inevitably failed to sell. It was hard work trying to find genuine items being auctioned by genuine people. It was hard work as an ordinary seller to sell as well, for the same reasons.
They have made some adjustments, such as being able to exclude “buy it now” items from a search listing, but I think it is too little too late. Ironic because, contrary to the arguments above, I believe the economic downturn ought to BOOST eBay’s activity. The fact that it hasn’t shows eBay is dead in the water.
One would think that the economic downturn ought to BOOST ebay activity, as you stated. Here’s what I have seen – An increase in the number of Sellers (who either like to maintain some distance/privacy buffer from the Seller or have yet to discover Craigslist) trying to sell to potential eBay Buyers (who now, also have less money to spend). The result? A Buyers market (for those Buyers who have remained on eBay, despite the state of the economy.)
You could be right as well
My observations date from long before the economic crisis, I believe eBay was a dead duck years ago for the reasons I have stated. The crisis *could* be a chance for eBay to salvage the situation, but then the arguments you cite kick in.
I agree. eBay killed itself by making sellers, who after all make the site what it actually is, feel like criminals. It’s bullsh*t not being able to neg a buyer who decides they don’t want to pay, and then get left a neg because the buyer thinks 7 days to post something overseas is too long.
Basically what happened to eBay is “no auction for you!”. eBay must have had some really unproductive meetings:) but then I did not exist at thy time. It’s not late eBay:)
Http://themeetingnazi.com
Why doesn’t eBay admit it killed itself. Anyone who used to sell or shop there and no longer does due to bad policy changes over and over knows that.
Rabois writes: "Itâs actually the social graph and similar products that have placed a stake in eBay.com. Most often, people blame eBayâs decay on factors like the weakening economy, the rise of Amazon, as well as eBayâs own inefficient search functionality. But the real and simple reason is eBay is no longer fun. Over the years, it has lost online ground and eyeballs to pure entertainment destinations such as YouTube and social networking sites like MySpace and Facebook."
totally agree with that ken… and from my viewpoint ebay was never really any fun to begin with
what killed ebay is that you can’t find a human being selling an item anymore. it’s all super stores, outlet overstocks and companies with 10-100 of the item for sale. yeah, it makes it easier to find what you want at a good price, but who actually bids on items anymore when you have the option to buy it now?
that is what killed ebay. not any of the other social networking sites.
That’s because ordinary smaller sellers are treated like potential thiefs. You will be locked out of our payment for up to 21 days till the buyer leaves positive feedback (and if they leave negative feedback for a frivolous reason, you may never get your money). That’s if your feedback score is less than 100.
Is’nt that a GREAT way to acquire new small sellers???
Huh? When did this happen. I am a seller with about 65 positivie feedbacks and have never been locked out of money. Please don’t decimate bullshit.
Her statement is partly true. Ebay decided awhile back that if your feedback was under a certain amount (100) or you had been selling less than 6 months and you sold in certain high risk categories (mainly electronics, cell phones, computers, etc) that you would not receive your Paypal payment until the buyer left positive feedback or 21 days had passed. So you had to ship your item before you ever received payment.
Craigslist killed ebay
I agree. Why sell something on eBay when they’re going to take most of your profit (unless you’re an uber-seller) when you can sell it for free on Craigslist?
I actually disagree. I used to think that, but then realized you can’t trust anyone on Craigslist.
Try actually selling something on Craigslist (or worse, give something away), and you’ll see what I mean.
Yeah, I wouldn’t want to exchange money or meet anyone off Craiglist face-to-face. (Unless it’s for a job interview)
It wasn’t YouTube or Myspace or Facebook that killed eBay, it was Meg Whitman’s total incompetence.
I was a Powerseller, and certified eBay instructor and it was the disregard for the sellers that killed eBay (although some would say sellers “had too many rights”).
eBay’s greed (fees could add up to as much as 20% of the sale price), and attitude towards sellers created a situation where sellers that actually cared about providing quality products and services to their buyers were forced out, in favor of cheats and “big business” who don’t give a rats-you-know-what about the buyer.
I’m sick of misinformed articles like “site a killed site b”. It’s complete BS. A company dies because it deserved to- either because they didn’t innovate and/or they provided a crappy service/product.
eBay died/is dying because they made several BAD decisions and they didn’t listen to their customer base. It’s as simple as that.
Yup, she did kill it, it was on her watch but like Zander and McNeely at Sun she got out while the getting was good. Ebay always had two customers: the sellers and the buyers. But, they focused on the revenue stream and forget that they needed as a website to provide the enticing context for the buyers within which that revenue stream would occurs. A B school 101 blunder. Non profits have the same problem but deal better with it: who gives them money is not who the real service is actually provided to. Same for Ebay. Ebay had a responsiblity to drive traffic to the site whatever way they could and they failed miserably at that.
Did you see her interviews on Charlie Rose?
I was rolling on the floor laughing when she was describing how she came to the company and … drumbeat… it turned out that THEY HAD a business-model. Like in the MBA mind an intermediary charging a commission for putting the buyer and seller in touch should be researched thoroughly… does he have a ‘business-model’, you know. It was totally laughable.
I don’t think there’s a "real and simple reason", but I’d agree with Rabois that folks do tend to overlook the extent to which eBay was entertainment. The rise of Craigslist and Amazon as alternative sales channels, "spamming" of eBay by sellers of commodity consumer electronics just trying to undercut each other but adding jacked-up shipping charges, and what some might consider a shift from "fairness" to a bias in favor of the buyer are all significant factors.
Search Facebook, Myspace, and Youtube from a single searchbar to determine for yourself if they killed ebay.
http://www.republics.us
Could not disagree with this premise more. While the fun may have been expunged from eBay, social networking sites did very little to either accelerate or supplant this eradication. I second those who mentioned eBay shipping scams, onerous fees and Craigslist. I’d like to add eBay’s ‘Buy it Now’ feature and the prevalence of eBay stores. If I wanted to ‘Buy it Now’ from a store I’d go to Walmart or Target. I go to eBay to buy authentic retro 70’s skateboards from my friend’s cousin Billy who now lives in Kuala Lumpur and never threw his out. That type of auction (notice I said auction) was fun to win. Most people don’t think buying printer ink at a 2.8% discount from somebody’s garage in Topeka is too much fun.
eBay may have been the beneficiary of hype at some point, but this is normal for a new, fast-growing internet company.
The hype cycle always flattens, leaving only the core value proposition. For eBay, that is and always was going to be, ecommerce.
So I really don’t see the logic of this article. As long as revenues and profits are growing, eBay is doing fine; if they are not, it certainly isn’t due to FB et al. Social networking is a very different need from ecommerce.
If Ilog into FB today, it’s to relate with my friends. if I log into ebay, it’s to buy something. One is not s substiute for the other.
Social media and Web 2.0 is not such a one world view simplistic. If I log into Facebook it is to get on company group pages and be visible. Or I write on the wall of networking contacts I am cultivating. Or I am uploading my latest business slide deck to share with colleagues.
Get over your narrow view of what any site should be for. There is on truism, all sites are moving to a social media approach, even Linkedin with its groups, polls and apps. But Ebay has dimished that kind of appeal that the bidding wars created among people. By its avarious and single minded focus on money.
They could have made bidding even more of a social networking experience. But once your are public and are focusing on quarter to quarter revenues, and not the customers, well you see what happends.
The people that said that ecommerce is not social media are obviously all men that don’t watch Superbowl commericals. As any woman gets that shopping is supposed to be fun and a community grounded experience.
And of course as we all know everything is related to Twitter these days… I’d say there are some parallels here in the sense that as the site has had to shift it’s focus from building a community with the help of domain-savvy early adopters (sellers) to serving a broader audience (buyers), there’s some resentment by the early crowd. In eBay’s case, as you alienate that early adopter crowd, they move, and it’s questionable whether you end up with a sustainable system.
interesting piece keith… as always you’re provocative & certainly not shy with your opinions!
not sure I completely agree with your thesis of eBay “losing out to other sites with more fun”… I wonder if if it simply had to do with:
1) the rise of search-engine marketing (SEM) making the eBay marketplace less relevant for sellers
2) the long-term growth & mainstream familiarity of fixed-price (Amazon) over auction listing formats, and
3) the lack of vision & innovation from eBay in responding to either if the above, except via their checkbook (M&A deals) & more aggressive optimization for revenue/profit over user satisfaction & growth
in short, there are probably a number of reasons that eBay has lost ground over the years. that said, I’d agree with you it may have been the lack of fun at HQ rather than on the site which led to so many of us leaving for fun & new opportunities elsewhere.
hopefully the recent challenges will result in eBay taking a fresh look at how they can innovate again… with an emphasis on products & imagination over powerpoint presentations & spreadsheets.
There are several problems with eBay, but I wanted to point out the fundamental one that is normally omitted from the list.
Perhaps the reason you detail, the “fun factor” is omitted with good reason.
I agree that e-bay did benefit from a viral growth phase that allowed it to benefit from a strong network effect of buyers and sellers. The network effect is not only important for growth on the Internet, it absolutely provides a commonality between the growth of e-bay and youtube, facebook, myspace and other sites.
These three factors are crucial for growth on the web:
1.) Virality.
2.) A strong network effect that provides a barrier to entry.
3.) A business model that allows sustainable improvement, and advantages from scale for ALL players (e.g. buyer, seller).
Although you did not explain these ideas in your piece, I’m assuming these are the basics of what you meant.
However, the above features are really correlated features — the same features with most businesses that are web-focused and achieve large scale.
As a result, any maturing successful business is bound to lose some of the “sparkle,” and media attention unless the business counteracts the natural adoption of the changes it brought to the forefront.
Youtube, for instance, can not monetize the majority of the traffic it receives, and is being sliced down in size by Hulu, Vevo and now others in the online video marketplace.
However, going back to ebay, as people have mentioned…
Externally
1.) Overture / Adwords killed ebay.
Ebay has/had a responsiblity to bring traffic to its marketplace, ebay relied on PPC/adwords far too much for far too long.
(larger users can become indy)
2.) Google and the re-emergence of sophisticated useful search engines. Niche goods are easier to find.
3.) Craigslist /Newspapers getting a clue/ Local commerce.
Alternative places for niche and smaller users.
4.) Amazon as a moving target — relentlessly inveting in new tech for the bullshit “sparkle” to “wow” the street with the “next big thing” that never happens and is quietly mothballed.
Amzn P/E (ttm): 48.43
Ebay P/E (ttm): 13.45
Internally
Utter lack of creativity
Utter lack of threat analysis
M&A
Skype? v. investing in foreign craigslists clones.
jeez.
Skype v. investing in “micro” local commerce alternatives — e.g. college text book market.
Ebay deserves to die, but it has very little to do with Facebook, Myspace and Twitter.
I agree on several of the points.
SEM I think is a huge one for me, it’s trivial to do a search in google (click on shopping) to find data that back when ebay was hot didn’t exist. I simply use google more first.
Google compared to Ebay, google prohibits duplicate ads, while Ebay is flooded with them.
The ads on ebay generally are far less infomration than I need when I shop and most mini-sites do it far better. Video, Interactive guides walk through. So I generally go there first.
Amazon does a huge amount of PPC ads to get in people in the front door, and a good job of cross selling or faciliating the used market that
Ebay was easy to hack for social proof (several china, russian scam artists creating fake transactions to build up the trust score), less so with other networks.
I don’t know about this post. But I do know that comparing a social site with an e-commerce site it’s simply not convincing enough.
I just don’t think myspace or facebook has anything to do with eBay’s decay.
It might be me but I still find eBay fun to browse, I find what I need always, and if it’s not there I set up an alert a voila! 2 days later is there.
This comparison just doesn’t seem right to me.
Mike: I agree as well…it was entertaining at its core, ecommerce as a secondary effect. Now its just another auction site among many sites that sell things.
i agree about craigslist.
i recently tried to sell some items on ebay, the auctions closed, but i then found it such a hassle to ship with paypal. waiting 21 days for payment or trying to log a tracking number in paypal when i had no funds in there, blah blah blah.
i eventually decided to kill the sales and post on craigslist which resulted in me receiving negative feedback which i could not even respond to. so now i appear to be a deadbeat who took money without shipping goods. totally sucks.
i won’t return.
Taken from my earlier reply above: eBay/PayPal’s answer to Sellers: your eBay ID must have min 100 Feedbacks (not necessarily 100%,. mind you) to remedy this. This is absurd! Why? Becuase I could have 100 Feedbacks as a BUYER and that would satisfy this Seller’s obstacle! The solution: invoice the Buyer for ‘Goods’ from PayPal directly (not via ebay checkout) …but what a pain in the a$$.
What do you mean “invoice the Buyer for Goods from PayPal directly.” Please elaborate.
plus ebay has always had scams and dirty tricks to watch out for. back in 2004 or 2005 a co-worker of mine tried to buy a motorcycle and was swindled (his own fault for contacting the seller via email outside the ebay messaging system) out of like $6,000 – sending it via western union to somewhere in italy … now that kind of thing isn’t as common as it used to be, but just the fear that it might happen (because it has in the past) is enough to keep people away
That wasn’t an ebay scam, that was a scam that happened to use ebay’s name. it could just as easily have used craigslist’s name or your name. unfortunately because ebay is referenced by the scammer, it gets thought of as ‘an ebay scam’ even though ebay is never part of the equation.
how can you say ebay is not part of the equation? their website directly helped to facilitate this scam.
they should have better protection/screening methods to protect their users. the number of ticket scammers still operating on ebay is a disgrace. i would be very reluctant to ever buy a ticket through their site and just about any product i want to buy i can get at a better price with less hassle elsewhere.
I thought Skype killed eBay. It has been going down ever since they bought it.
huh..I didn’t know eBay was gone…
George, in the sense that RSS is dead, yes, FB, MS, YT, et al killed eBay – in reality: you can’t kill a website
I agree. When I’m bored I don’t browse ebay anymore – I watch youtube, check facebook and tweet. And when I want to find a deal, I check Craigslist.
So maybe one of those sites should buy Ebay and they you can have sellers hawking their wares on YouTube, updating your wall with new deals, and send you instant notifications of a sale.
That sounds great!
Video powered auctions were way better than some cheesy photographs and text. It must be real fun to watch people describing their ol’ stuff.
Powersellers could get an option to upload HD videos.
Without any irony – I think that’s a great idea!
But wait. Here in Germany the fee ebay takes is so expensive, that, if you’re looking for new items, every online shop is 10-20% cheaper than the powersellers at ebay. And for me that’s reason why ebay is dying.
more like eBay buy one of them…eBay, after all, is the one making money with a real multi billion dollar market cap
Can you tell me a single company making money from the social graph? FB isn’t!, Slide isn’t!, that term is highly overused and has shown no value! So not to say ebay has done all of the right things, but the social graph isn’t the answer.
It is better to hear this article from a neutral source. Keith Rabois is a former staff of eBay:
“Where did all the fun go?
…Reid Hoffman (LinkedIn, board member of Zynga) and others, myself included, were all too alienated by eBay’s bureaucratic and political MBA culture. So we decided to create our own fun elsewhere instead. ”
I might think that this is just sourgraping, an intent to promote their own stuff and downgrading an established site such as eBay.
Doesn’t bother me, if this article is merely indirect, self-promotion via semi-relevant stats accompanied by post-employer, legal-friendly, sour-speak. BRAVO, I say.
lol. The best whine is made from sour grapes.
I agree with you!
I used to love bidding in the last few seconds of an eBay auction to win, say, an out of print CD that I’d been searching for for 6 years (true story, I bid $70 for it with 10 seconds left just to make sure and won it for $6
. But a few things happened:
1. Many of the collectibles I was looking for I eventually found on eBay and now own.
2. I got older and couldn’t be bothered to spend so much time on auctions.
3. I started using a free auction sniping site that did the work for me; these days I use it for all auctions.
But I still can’t get over the fact that ANYTHING you’re looking for is on eBay, right now!
what’s the name of the sniping site you use?
http://www.justsnipe.com – Haven’t had my password stolen, haven’t ever had them NOT bid in the last 10 seconds or so. Apologize in advance for the lameness of their UI…
It is better to hear this stuff from a neutral source. Mr. Keith Rabois is a former staff of ebay:
I might think that this is just sourgraping, an intent to promote their own stuff and downgrading a well-established site such as eBay..
WHO CARES if this article could be construed as merely indirect, self-promotion via semi-relevant stats accompanied by post-employer, legal-friendly, sour-speak, it doesn’t bother me.
How many of us would love to stick-it to our respective, former employers?
BRAVO, I say!
(a new personal record for hyphen-use in a post, too)
what’s the auction sniping site?
I recommend Powersnipe myself
Keith, this is a brilliant post.
Usually the guest post on TC are so self-serving they lack any insight. I don’t know if this is self-serving or not, but it sure shows that we get too focused on analysis of user behavior & P&L w/o understand basic instincts and motivations behind human beings.
The simple take-away from this article –
Where are people (now) spending most of their time on the internet?
How can you exploit this?
Someone please notify me when a SuperPoke is more interesting than an eBay auction.
I can honestly say I haven’t visited eBay in over a year. I probably haven’t purchased anything on there is more than 2 years. It’s a total joke. I hate it now.
In the old days, people enjoyed building up their reputation on ebay. There was a bit of social networking there for everyone. Now they can get all that communication and build their rep with specialised social networking sites.
Amazon appears to have improved in my view (especially recommendations and ease of purchase on the site). Delivery is also a great strength of Amazon and unlike ebay, you don’t have to worry about sellers actually posting things on time. You don’t need to worry about crooked sellers, fraud, sales collapsing, wasting time watching your bids to see if you won etc. Now you can buy on any number of sites anything you like, when you want at the price you want. Now that things are even more competitive, you can pretty much get free delivery and buy below market price online.
Taht’s my biggest beef with ebay, every other time I buy something i get screwed…
the product is late, they give me the wrong product etc…
Wrong, wrong, wrong. Two things have hurt ebay. First, there are a ton of other choices now; the liquidity that made the ebay marketplace is now as fragmented as the rest of the internet. Search makes ebay almost irrelevant these days. I don’t know the last time I went on ebay because now I just search on google or yahoo. The other major alternative is Craigs List, where the listings are mostly free, it’s way easier and there are no time restrictions and other BS. The second thing that has killed ebay is the ebay gray market; it’s so bloody easy to list a store or items and then sell them off ebay via email or telephone. I bet there is 4-5x the amount of commerce off ebay that actually on it.
yep.
You guys are wrong, empirically, historically and logically.
a) Craigslist is actually neither a new threat to eBay nor fueled by non-fun either. Classifieds 2000 actually had more listings than ebay as late as 1998 and maybe 1999, but like CL it did not “close” the transaction. So it lost.
b) The grey market is not larger now than 2000-2001. Check eBay’s own studies.
c) Google did not really kill ebay at all, although ebay’s management missed the opportunity in 01-03 to trump ebay. More commercial searches were performed on eBay than on google at least thru 2001.
Mr. Rabois, I think the premise of your article is wrong, I’ve detailed the faults in another post.
Your concept of “fun” / social graph really needs to be unpacked as the exponential growth phase of a company — like twitter is going through now.
That sort of growth is not likely to happen again for ebay, so it is faulty to compare ebay to YT, FB, Twit and others who are currently experiencing that sort of viral growth in relative terms (also in terms of media attention).
I think that people are trying to abstract ebays current lack of growth from your article, and do a better analysis on that lack of growth by the examination of real competitive threats that emerged during the time period you discuss until the present (thus stats from 2000 only aren’t helpful either way).
If ebay is truly worried about how to be more “fun” rather than true issues that people have described, they are in more serious trouble than I thought.
Fundamentally, ebay has NO new businesses from inception, save paypal (which ebay waited until the last possible moment to buy as I’m sure you know better than any of us in the peanut gallery) and stubhub.
When ebay launched it was auctions, ebay is still auctions!
Amazon is books and all else, small merchants, hosting, assorted other stuff.
Ebay flip-flops when they either need to focus on creating tagential internal COMMERCE related projects and buy COMMERCE acquisitions globally (why did yahoo snag alibaba?) or chase the next big thing (skype, stumble). Ebay needs more commerce brands like stubhub in niche areas, not social graph plays in random businesses.
That said, I think your comments about internal culture are probably more important than the “fun” premise — that ebay strangled the creative leadership it needed to aggressively hunt new ideas for commerce growth.
Thus, I think your article would have been better focused on the culture inside ebay — rather than harnessing the creative people to push auctions into new areas like:
domain names (sedo.com, oversee.net — $50MM)
a little tasty side business.
textbooks
tickets (stubhub great acquisition)
etc..
Ebay forced these people out, where they developed interesting products.
Ebay could use those same enterprising souls to develop top notch local-classified applications for social networks.
Or ebay should just give up, and become as slim as possible and squeeze out efficiency like Dell tried to do with computers, it didn’t work for that long but hey, ebay could try.
Cut the management layers, focus on reducing fees, improving performance, and not worry about getting side-tracked.
Buyers were attracted for the fun, not just the utility.
More buyers, by definition, created higher ATV for sellers, and more profits.
Management foolishly tried to chase Amazon, and created an Amazon lite instead of an eBay prime. Stripping out the fun left eBay.com in the worst of all worlds, neither fun nor as useful/convenient/intuitive as Amazon.
$8 Billion in revenue is far from dead.
Slide.com on the other hand…
when all else fails you run for govenor even though you did not vote in the last 6 elections. duh.
is slide that photo widget who had a 200 million valuation?
http://www.tech...ses-50-million/
according to slide funwall super poke and photo widgets are the future?
http://vator.tv...how/Slide-Slide
maybe this is why we do not hear about slide anymore?
RealityLocator .com – like it is
You are an idiot. All you do is post negative comments on every story and then end with your useless URL. My mission is to torment you. No one likes you. No one finds your comments useful. Your mom doesn’t even like you.
getalifelocator.com — waste of DNA
All the competition of new websites have caused ebay to lose overall percentage of internet time. These new, free options give users options.
Ironically, these new sites have caused ebay to lose traffic but the economy and the increase of people using the internet to find better deals will probably help ebay’s traffic this year.
Jenn
Powerfull ebay tool to find cheap auctions
http://typobuy.com
Combine typobuy.com with your own eBay affiliate ID and you may have something there.
As an avid eBay Buyer (admittedly Selling has become almost too cumbersome to bother) I fail to jump onto the Craigslist bandwagon wholeheartedly. I’m not searching for any particularly ‘rare’ items, but I don’t see myself waiting for said items to be listed in my immediate/local area so that I can use Craigslist. Result? I have to make use of 3rd party tools to expand my Craigslist searches. Also, Craigslist Sellers (unless they are Ebay refugees) tend to be less savvy, for better or worse. Maybe I’ll convert, once they get done worry about their Erotic Services cat
Erotic Services cat-egory. (damn trackpad!)
You can’t even search all over the country for things at once. You have to do a search for something at a regional level. I’ve bought many things off eBay from out of the country and hundreds from all over the U.S.! Until Craigslist gets a better search system, they aren’t even getting my interest.