EBay (EBAY) wants to create a marketplace that appeals as much to smartphone-savvy millennials as it does to longtime users.
Since eBay spun off of PayPal (PYPL) in July 2015, the popular online marketplace has been on a mission to update its website and app with technologies that make its site and app more compelling as larger competitors like Amazon (AMZN) aggressively expand their online marketplaces.
Ebay’s efforts so far, appear to be working. Although eBay’s fourth quarter marketplace revenue trail Amazon’s, users and shareholders are rewarding eBay’s steady growth. The marketplace saw active buyers increase 5% year-over-year during its fourth-quarter to 170 million. Meanwhile, the stock now hovers just under $43 a share — up 52% since the eBay-PayPal split three years ago.
Chalk much of eBay’s recent innovative streak to senior vice president and chief product officer RJ Pittman, a Silicon Valley veteran, who spent years working at Apple (AAPL) and Google (GOOG, GOOGL) before joining eBay in 2013. Pittman and his group are responsible for developing new features for eBay’s site and app and keeping tabs on the latest technological trends.
To that end, eBay has rolled out a slew of new features over the past two years to keep the marketplace and its app fresh and competitive, including a new “Under $10” section announced earlier this month geared towards budget-conscious millennials. On a broader scale, eBay rolled out a smarter, more attractive homepage last year that uses artificial intelligence to offer a more personalized shopping experience based on what you click on, what you search for, and what your interests are.
The online marketplace has also launched innovative features. Snap a photo of an object you see somewhere with the eBay smartphone app, and eBay offers up listings of items that are similar-looking by style or brand.
“The common way you would begin a shopping journey is by typing a search,” Pittman explained to Yahoo Finance. “It seems like a reasonable thing to do, but what if you see a pair of sunglasses on a side table at your friend’s house that you think are pretty cool, but they don’t have a brand on them, and you don’t know what they are, but you love the style, you love the frames or the lens. In today’s world you gotta be able to take a picture, point your camera at that item and then find something that’s either exactly that item or something very similar and a great price. And that’s exactly what image search yielded. We’re bringing together the science of commerce, perfecting this has been more of an art of science over the last 10 years.”
In October 2016, eBay also launched Shopbot, a chatbot on Facebook Messenger that can do the heavy lifting of deal hunting and discovery for shoppers through a simple conversation or photo. Even better, it has a virtual memory and remembers what you like and don’t like, much in the way a real-life personal shopper would.
“You don’t have to spend your time hunting around and doing repetitive searches,” explains Pittman.
Moving forward, Pittman did not specify how exactly he expects eBay to evolve other than to emphasize the marketplace’s advantages over competitors like Amazon, which continues to spend billions to expand its already vast physical infrastructure of warehouses. eBay, in comparison, has no such costs to deal with.
“We’ve paid zero dollars a month in rent for fulfillment warehouses and logistics infrastructure because we’re leveraging the power of the network and that provides tremendous scalability,” contends Pittman. “That’s a wonderfully scalable opportunity for us, not just from an inventory perspective, but also from a buyer and shopper perspective, because we also don’t have a physical presence for retail. You can effectively fit the entire world into our shop.”