Revamping eBay The Internet Treasure

eBay has always been an internet treasure. When we talk now about social media I always think about the value of a marketplace like a social phenomenon. Social shopping has always been a part of eBay, making people compete and interact by placing auctions and writing opinions about other people or stores. eBay's best move was buying Paypal in 2002 and since then their cash flow has been a machine that generates investment capacity. Maybe their biggest mistake was buying Skype in 2005 and having to sell it at a ridiculous price in 2009. Classifieds have also be one of the targets that eBay wanted to reach. Their affair with Craigslist and some acquisitions they made in Europe have brought them into the arena of one of the most profitable businesses on the internet.

But eBay needs more to compete against Amazon. They need to be the B2B and Small Business ecommerce company. Amazon is a tough competitor. Used to working with low margins, they are able to confront any new battle as if it were the last one. Cloud computing, Kindle, marketplace, music cloud, etc. Amazon has demonstrated that they will always be a key player in the ecommerce arena. So eBay needed to bring something different to the market and be the number one in that field. A vertical integration of what a manufacturer and a retailer need to run their business online would be the field where Amazon has no significant presence and eBay could integrate all their assets to become the market leader.

So in March 2011 eBay bought 49% of the ecommerce software platform Magento and  now they bought GSI Commerce, an ecommerce multichannel retailing and interactive marketing services company. With these two acquisitions, eBay is integrating all the B2B ecommerce services that they will need to compete against Amazon. The challenge for eBay will be how to structure their online marketing services for Small Business and unify their online marketing and advertising offer. They run the risk of becoming the new Yahoo! Advertising Solutions and losing all the power of their vertical integration. Maybe its time to add Shopping.com to this new equation. Maybe they are looking to buy a private outlet. Will they do it at last?

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