eBay to Hold Analyst/Investor Day: Ten Questions to Ask Them

Big news eBay (EBAY) Strategies readers - eBay is having a big investor/analyst day next week - Wednesday, March 11th that will be webcast. Curiously, there's no information on the investor relations site about it yet (come on Mark!) but several analysts have put out notes mentioning it and eBay talked about it at the Goldman talk.

Putting that datapoint together with a couple of other 'hints' coming out of eBay:

• Several readers that follow Griff's Q+A for sellers threads on the eBay forums have said that Griff has hinted - big news coming in March. (Warning - those forums are not for the faint of heart or those that don't want to get sucked into a 2hr drama-fest).
• Ina@auctionbytes covered the last eBay town hall and has a similar datapoint.
• Sellers are generally nervous because historically eBay has introduced annual fee hikes changes in the January timeframe (e.g. the e-commerce forum in 08 was in late Jan), yet hasn't announced anything thus far in 08. Sellers are in a weird limbo, not sure what their business model will look like for 09.
• Ina also reported that eBay had a meeting in Long Beach and gave some top sellers a preview of changes coming soon.

So putting 2+2+2+1.5+3.14159265 together, my guess is that we'll either have a big announcement of changes on 3/11 or at least some more meaty signs of things to come. If eBay does roll out changes at the meeting, it will be an notable change from last year's approach. As previously mentioned, last year eBay rolled out the bulk of 08 changes to a room full of 300 or so top sellers. This year they previewed to some sellers in Long beach and then rolled them out to Wall St.

Many sellers I talk to believe that eBay doesn't really think of sellers as stakeholders in the business, and puts buyers and wall street at the front of the bus. Some could take this change in audience and venue to roll out changes (if they do), as supporting the claim that sellers are low on the proverbial totem pole of stakeholders.

In any case, I recommend sellers keep a close eye on this one along with the rest of the stake holders because I don't think eBay would do an all day event like this (first in 3yrs+) and not have something to say.

What's coming?

In his Goldman talk, John Donahoe mentioned they aren't changing fees (up or down was the implication) this year (not his exact words, lots of wiggle room in there as it's not clear if he was talking about all fees,fixed-price only, us only, etc.) so I'd take that with a grain of salt.

I have no other predictions for what's coming, so it's going to be interesting. Hopefully eBay will announce some things that get them down the path of our proposed eBay 2.0 strategy. I did hear from a couple of eBay shareholders that had private meetings at Goldman that big changes are a foot and they were 'encouraged' to attend the investor day.

We have you covered!

We'll have full coverage of the event here at eBay Strategies and are bookending it with two events:

• Tues., March 10 - 2pm ET I'm doing a live radio show with John Lawson @ Colderice - John is an eBay blogger and social guru as well as a top eBay seller (and ChannelAdvisor customer I'm happy to fully disclose). Sign up should be available here soon.
• Wed., March 11 - Will be live-blogging the event. They haven't officially published the times yet, but I suspect it will be 9-2ish PT. Listen to the webcast and join in on the conversation here. I'll also be tweeting anything earth shattering.
• Thurs., March 12 - 11 am ET Citigroup Wall St. call - I'll be chatting with top internet analyst, Mark Mahaney in more detail about Amazon's (AMZN) seller business and we'll also cover any news coming out of eBay's analyst day. I believe this is for Wall-st types only, those interested can contact Mark for details. For non-Wall st types, I'll post some highlights here later in the day.

Finally, Mahaney published a '10 things we want to know from eBay analyst day' list (which is ironic because he looks like Conan O'brien, but does a Letterman top 10 list?) That I thought was a good summary of what Wall St'ers will be asking the company and will be relevant for everyone in the eBay ecosystem to listen for on Wednesday:

1. What steps can eBay take to improve the Marketplace Buyer experience?;
2. What steps can eBay take to improve the Marketplace Seller experience?;
3. Is the Auction format an anchor around eBay's Marketplace growth?; (**I have argued that eBay has accelerated the decline of this format)
4. Which International markets are showing the most potential and which the most risk?;
5. What are the new growth strategies for PayPal;
6. What are the anticipated synergies between PayPal and BillMeLater?;
7. What are the marching orders for Skype, given the lack of synergies with eBay or PayPal; (**Sell it! - auction it on ebay ;-) )
8. What are the long-term growth opportunities for the Marketing Services segment; (**ads on ebay - just say no)
9. Are there material new cost savings opportunities for eBay or does the revenue mix shift away from the high margin Marketplace segment make long-term operating margin declines inevitable for eBay?;
10. What are eBay's options with its $3.2B in cash?

Disclosure: Author is long Amazon and Google

Comments

[Black Is White:]

The recent Ebay “Town Hall” around the time of the Goldman Sachs talk was shocking.

Ebay’s massive detachment from reality and disconnect from the disaster that is ebay 2009 is inexplicable.

The “Town Hall” could have been from May of 2008 when the ebay execs told everyone how great the new changes were even though they punished honest sellers, driving them away from the site).

The “Town Hall” ebay execs were clueless. No, they were somewhere way beyond clueless.

By the time of the February 2009 “Town Hall”, ebay has had months to see all the many ways the May 2008 changes are failing; they’ve had many chances to hear the anger of sellers expressed in every way possible, they have had many chances to witness the flight of sellers to other sites and many chances to read the many online critiques of ebay’s current “management”.

Their response - “La, la la, la, everything is beautiful at the circus.”

Of particular note were the “Town Hall” words of the architect of ebay’s severely flawed feedback changes, Brian “A neutral rating is a negative rating because it isn’t a positive rating” Burke.

Black is white because it isn’t red.

He still maintains that there is something ethical about telling buyers that a “4″ Detailed Seller rating for a seller while punishing/suspending any ebay seller with a “4″ average Detailed Seller Rating.

Black is white because it isn’t red.

Burke also believes that an ebay buyer who does not pay for an ebay item should be able to leave an ebay seller negative feedback for an auction never completed. That’s like saying a consumer can sue a retailer for a slip and fall accident when the consumer never entered the retailer’s store.

Black is white because it isn’t red.

As has happened in past “Town Halls” a seller phoned in with his own statistics showing how the May 2008 changes have damaged his ebay business. And as in similar past calls, Burke quickly hauled out the data, saying ebay’s “research” showed that the seller’s real world experience hadn’t happened or was an anomaly.

Black is white because it isn’t red.

Well you know ebay, you could roll around in facts all day long…

Amazing that none of the ebay execs behind this train wreck have been removed from the site for poor performance.

Sad that some wise long time ebay execs who understood the site have fled. Even the creator of ebay’s disastrous new “Search”, Raghav Gupta, left. He maintains that ebay is misusing his creation. His parting shot to his former colleagues at ebay was a poem titled “Ode to Ebay” in which he wrote.

As with all blinding power
The custodians went slowly sour
Took the community for granted
Seeds of dissent met with dour
The ecosystem was finally salted.

Black is white because it isn’t red.

Ebay is bad because ebay isn’t good.

Mar 05 07:20 PM

[coyotebait:]

Yada yada yada. So eBay is holding a meeting for nada? ...Chirp on all ye scorned embittered half-empty fools. You won't know until you know. And then it will be too late. ...Give the chimps a chance.

CHOMPS,

^__^

..

Mar 05 07:32 PM

[Wake-Up!:]

Well stated Black is White. I've heard of double talk but that is quadruple talk! I've already left that train wreck. There's nothing eBay can do to bring the sellers they have abandoned and replace with over seas-garbage sellers, back to that miserable has-been. Throwing eBay $9.30 for every $49.99 sale is why I successfully sell on www.Bonanzle.com. I actually make more selling less! For every 12 items I sell on Bonanzle, I put $111.60 MORE in my pocket! My fee is just $12.00 on Bonanzle.

The best "announcement" they could ever possibly give, would be to admit that they are all incompetent and they will be selling the site to Google.

And don't forget the classic spin: "You asked and we listened! We've lowered listing fees and "adjusted" Final Value Fees"

Mar 05 08:49 PM

[timboyebay:]

Ebay is much like coke, coke introduced the "new coke" and no one liked it and it failed, a very large difference is that coke did not alienate its customers and pull old coke from them.
The "new e bay" is a failure and its management system leaves buyers and sellers in wonder of why this company has done what it has done to its customers. I think e bay is going to be very solid and level at $8-9 because of Paypal.

Management is completely callous to its customers, anyone who knows what is gong on at e bay should be appalled that the CEO says "We're absolutely confident of the direction we're going" when the company's customers are being pushed away by the company and others are simply not willing to list or use the site.
It should be clear, I am a wholesaler and not a good writer or a stock expert, but I have a first hand inside look having been a powerseller almost from e bay start, for over 10 years, 1.7 million per year sales and account for $156,000 paid to e bay per year for seller fees, this is the bases in which e bay shows profit or loss in a great way for there core business, this does not account for paypal fees charged, seller manager pro, e bay stores. NO MORE, I AM OFF E BAY UNTIL THEY CHANGE MANAGEMENT.
Buyers and sellers are leaving e bay,
this can be proved by www.sellerdome.com

It seems from the data that another 15% has simply decided e bay is not worth doing any longer. This is proved by:
blog.sellerdome.com/?p...

That is huge, think of 20-25% of ebays top 100 powersellers, like myself, find that e bay is no longer worth doing. That is 25K e bay powersellers who account for $3000-$20,000 in seller fees paid to e bay each month from sellers. WOW, you do the math and see if you can see any room for success?

This is the only company separating itself from its long time customers in an economy that is extra needing of customers. Many powersellers, like myself, who has been with the company fatefully since inception and made it a community before new management have given up on "freebay".
Managements approval ratings would not be in the 20% range if it were doing the job "22% “Approve", see the link below and see what employees are saying about CEO John J. Donahoe:
www.glassdoor.com/Revi... to see Mr. Donahoe's DSR rating.
Note the 190+ Reviews under the rating.

This is the only CEO that I know of that has its partners/buyers/seller... asking for them to step down:
www.petitiononline.com...

Notice that the former CEO WHITMAN MARGARET sold many shares before ebay implemented flawed policy, notice no insider trading unless the stock is a gift it seems:
moneycentral.msn.com/i...

Instead of working within the community, that once believed that "people are basically good", took on a policy that made its tight net community fell like "criminals under big brother" and strong feelings of dislike for the symbol that was once regarded by its employees, buyers and sellers. Ebay has aggressively pushed away its partners will prove to decline its future market share and a relationship that may go un repaired when new management is called upon. When the culture was "people are basically good" employees at e bay were chronic buyers on e bay, now that has changed. It should also be noted that the sellers they suspended are also big buyers on e bay generally.

Things are not happy under new management/John Donahoe management has made no one happy, employees, sellers or buyers or its investors. It has been a 10 month meltdown since new management fumbled a working system.
Ebay may have ruined their market flair for both buyers and sellers forever. Too many restricting rule changes, increased charges, paypal demands, seller ratings. This has ultimately destroyed their bottom line in a time where a recession should be showing e bay as the golden hair child.
Many sellers, buyers and investors alike have a dedicated special interest and hope management changes and ebay will turn themselves around, but it is going to take some quick and correct policy change back to the system that worked to undo what has been done in what would be considered by many as well as a powerseller account manager in a telephone conversation said that this is "the most aggressive change e bay has ever done" it is costing sellers there business and driving buyers away from the site. The Best Match search is fatally flawed and $0.35 listings, with unprecedented raises in back end fees, are not going to fix that.

Sellers of the unique items that made eBay famous (and who paid listing fees) are leaving in record numbers, while eBay brokers deals with corporate sellers of new stuff you can get anywhere who don't pay listing fees deteriorate the profits. And their buyers are following them. Watch the Q1 09 figures. A company of this size can keep up appearances for some time, but its customers, its customers customers, that is sellers and buyers, are speaking up and cannot be ignored in the long term, the leader of these policy's are and continue to drive away the core business of e bay and investors are taking notice.

Let me say, I LOVE E BAY, it is just sellers and buyers don't like what new management has done to its strong culture. We have a vested interest and love for the old e bay culture.

Just one of the PAST buyers and sellers temporarily driven away by new management, it will be interesting to see what the new management that is suspected to come will do to the culture. Hopefully Auctionbytes is right in looking for a replacement for JD and you can see the 150+ comments below the article shows not one good thing to say about this management
blog.auctionbytes.com/...

Good thing for golden parachutes I guess, maybe that will soften the fall?

Mar 05 10:27 PM

[timboyebay:]

Ebay is much like coke, coke introduced the "new coke" and no one liked it and it failed, a very large difference is that coke did not alienate its customers and pull old coke from them.
The "new e bay" is a failure and its management system leaves buyers and sellers in wonder of why this company has done what it has done to its customers. I think e bay is going to be very solid and level at $8-9 because of Paypal.

Management is completely callous to its customers, anyone who knows what is gong on at e bay should be appalled that the CEO says "We're absolutely confident of the direction we're going" when the company's customers are being pushed away by the company and others are simply not willing to list or use the site.
It should be clear, I am a wholesaler and not a good writer or a stock expert, but I have a first hand inside look having been a powerseller almost from e bay start, for over 10 years, 1.7 million per year sales and account for $156,000 paid to e bay per year for seller fees, this is the bases in which e bay shows profit or loss in a great way for there core business, this does not account for paypal fees charged, seller manager pro, e bay stores. NO MORE, I AM OFF E BAY UNTIL THEY CHANGE MANAGEMENT.
Buyers and sellers are leaving e bay,
this can be proved by www.sellerdome.com

It seems from the data that another 15% has simply decided e bay is not worth doing any longer. This is proved by:
blog.sellerdome.com/?p...

That is huge, think of 20-25% of ebays top 100 powersellers, like myself, find that e bay is no longer worth doing. That is 25K e bay powersellers who account for $3000-$20,000 in seller fees paid to e bay each month from sellers. WOW, you do the math and see if you can see any room for success?

This is the only company separating itself from its long time customers in an economy that is extra needing of customers. Many powersellers, like myself, who has been with the company fatefully since inception and made it a community before new management have given up on "freebay".
Managements approval ratings would not be in the 20% range if it were doing the job "22% “Approve", see the link below and see what employees are saying about CEO John J. Donahoe:
www.glassdoor.com/Revi... to see Mr. Donahoe's DSR rating.
Note the 190+ Reviews under the rating.

This is the only CEO that I know of that has its partners/buyers/seller... asking for them to step down:
www.petitiononline.com...

Notice that the former CEO WHITMAN MARGARET sold many shares before ebay implemented flawed policy, notice no insider trading unless the stock is a gift it seems:
moneycentral.msn.com/i...

Instead of working within the community, that once believed that "people are basically good", took on a policy that made its tight net community fell like "criminals under big brother" and strong feelings of dislike for the symbol that was once regarded by its employees, buyers and sellers. Ebay has aggressively pushed away its partners will prove to decline its future market share and a relationship that may go un repaired when new management is called upon. When the culture was "people are basically good" employees at e bay were chronic buyers on e bay, now that has changed. It should also be noted that the sellers they suspended are also big buyers on e bay generally.

Things are not happy under new management/John Donahoe management has made no one happy, employees, sellers or buyers or its investors. It has been a 10 month meltdown since new management fumbled a working system.
Ebay may have ruined their market flair for both buyers and sellers forever. Too many restricting rule changes, increased charges, paypal demands, seller ratings. This has ultimately destroyed their bottom line in a time where a recession should be showing e bay as the golden hair child.
Many sellers, buyers and investors alike have a dedicated special interest and hope management changes and ebay will turn themselves around, but it is going to take some quick and correct policy change back to the system that worked to undo what has been done in what would be considered by many as well as a powerseller account manager in a telephone conversation said that this is "the most aggressive change e bay has ever done" it is costing sellers there business and driving buyers away from the site. The Best Match search is fatally flawed and $0.35 listings, with unprecedented raises in back end fees, are not going to fix that.

Sellers of the unique items that made eBay famous (and who paid listing fees) are leaving in record numbers, while eBay brokers deals with corporate sellers of new stuff you can get anywhere who don't pay listing fees deteriorate the profits. And their buyers are following them. Watch the Q1 09 figures. A company of this size can keep up appearances for some time, but its customers, its customers customers, that is sellers and buyers, are speaking up and cannot be ignored in the long term, the leader of these policy's are and continue to drive away the core business of e bay and investors are taking notice.

Let me say, I LOVE E BAY, it is just sellers and buyers don't like what new management has done to its strong culture. We have a vested interest and love for the old e bay culture.

Just one of the PAST buyers and sellers temporarily driven away by new management, it will be interesting to see what the new management that is suspected to come will do to the culture. Hopefully Auctionbytes is right in looking for a replacement for JD and you can see the 150+ comments below the article shows not one good thing to say about this management
blog.auctionbytes.com/...

Good thing for golden parachutes I guess, maybe that will soften the fall?

Mar 05 10:28 PM

[redbaron:]

Thanks for the updates, Scott. Will look forward to news on and around March 11.

Mar 05 11:30 PM

[eBay +++:]

Why sell Skype now Scott? I can make no sense of that, not in this environment. Why not let the next 2yrs play out with Skype? How does that hurt eBay? The lack of focus is a bunch of crap, Skype operates as a separate entity and at this point the reward by far out weighs the risk.

I remember Meg claiming eBay would only make large financial moves based on the environment being right. I have to think that Donahue being her protege is of the same mindset. Obviously the environment to sell Skype is not right. I just hope he does not given into Wallstreet's pressure.

Mar 06 12:05 AM

[x_powerseller:]

What the “DEVIL” J.D. did to EBay since he took over last year is simply criminal, in my opinion.
As an x-powerseller, we are doing great without EBay selling our products through our own websites and other platforms including Amazon.

But, what about all the other sellers, this imbecile put out of business, almost overnight!
The ones, who depended on EBay to put food on the table, buy their medicine or pay their bills and don’t know how to do anything else but to “EBAY”.
EBay was a way of life for so many and the only thing they knew for years!

Read EBay boards or other blogs around the internet to find out how these sellers are hurting, all because of this “DEVIL’s” insane policies. Many heartbreaking stories.

Even, let’s say if this “DEVIL” thinks in his sick mind that he is doing all of this for the good of the company, wouldn’t a sane person take a note of all that’s been happening, think again and correct his mistakes?

Stock price April 08 = $32.43
Stock price March 08 = $10.46 (soon to be a single digit)

Last quarter 08 = disaster

Sellers are leaving in droves taking their customers (buyers) with them
Diamond sellers selling toilet paper and the likes without even paying any fees to EBay!
EBay is now infested with Chinese garbage.
EBay is the place to be for all scam buyers who can easily keep the item and be refunded by Paypal, negging the seller and destroying his/her DSR just for the fun of it.

And the list goes on and on …..

“EBAY” brand has been now tarnished forever.

The “Worst” Match technology is FRAUD, once again in my opinion! Sellers are paying fees for their products to be seen, not to be hidden! Yet EBay is happy to take the fees without providing the service!

How can people like this CEO, go to sleep at night is simply beyond me!

Fire J.D. the “DEVIL” Now and send him back to business school!

Mar 06 12:48 AM

[x_powerseller:]

Correction:

Stock price March 08 = $10.46 (soon to be a single digit)

should be

Stock price March 09 = $10.46 (soon to be a single digit)

Mar 06 12:50 AM

[leapingcat:]

Only one question is needed from investors, as opposed to users:
'A year ago Ebay as a company was worth more than Amazon; now it is worth half as much. Your attempt to become more like Amazon has failed, whereas Amazon has weathered the financial storms reasonably well; how quickly are you going to ditch this flawed policy and return to giving your users what they really want and so give us a return on our investment?'

Mar 06 04:49 AM

[Tippie:]

As a totally frustrated and disgusted shareholder of eBay I truly hope that at this meeting on March 11 eBay will have seen their error ways. Competing with Amazon is futile. Amazon is the clear winner in retail business online. eBay cannot hope to compete in retail with a name like "eBay Auctions! eBay sellers were Ma and Pa operators that could not sell in high volume on Amazon and therefore sold on ebay. Millions and millions of these small sellers sit by the wayside! Amazon stock is $65.00 respectfully, versus eBay stock of $10.00 that is currently sinking fast. If I were Donahoe I would read the writing on the wall!

Mar 06 11:12 AM

[Wake-Up!:]

Considering eBay stock has plummeted today (March 6, 2009) down into the single digits $9.91 (so far), perhaps eBay is announcing a liquidation sale! LMAO!!

Shareholders need to listen to the sellers (mostly ex-sellers now) on eBay if they really want to know how eBay is destroying itself. Stop listening to the spin doctors and the truth shall set you free! (and probably save you some dough, too). Hate to say we told you so, but we told you so.

The crash and burn is inevitable. SELL! SELL! SELL!

jmo

Mar 06 11:15 AM

[NYM Arts:]

Hi Scot,
Just a Reminder :
EBAY BOTTOM = ZERO
Back Away Slowly.......

Mar 06 11:20 AM

[sadlygone:]

We sold full time on ebay since 1998 and made a reasonable living for most of it. 4900 100% positive feedbacks. The fees and shipping went up. Profits shrank but we worked harder and made do.
After the nightmare changes started last year, Paypal only being the last straw, we sadly left.
My partner declared that "ebay was a National Treasure and They should be severely punished for destroying it".
We know a huge number of people who have been financially ruined by putting all their eggs in the ebay basket and having the Devil John smash them with a sledge hammer.
Thank You ebay for destroying what was once a way for many hard working little people to make a living wage. I believe they have hurt the economy as much as the housing crisis.
But really who the hell cares !!!!
jw

Mar 06 01:10 PM

[downwithebay:]

Here's an interesting find. 8 SHORT days ago a bunch of the suits at Feebay were awarded a TON of stock for their performance in 2007-2008. ALL the big numbers below are the number of shares each putz received. Pretty stinking sad when shares of Feebay stock have plummeted roughly 60 percent in one year, YET Feebay suits get rewarded with MANY 1000s of shares in bonus stock. Absolutely B.S.!

02/27/09 NORRINGTON LORRIE M Exercise 58,334 NA NA
02/27/09 SWAN ROBERT HOLMES Exercise 66,667 NA NA
02/27/09 THOMPSON SCOTT Exercise 8,334 NA NA
02/27/09 AXELROD ELIZABETH LYNN Exercise 46,667 NA NA
02/27/09 DONAHOE JOHN JOSEPH Exercise 127,196 NA NA
02/27/09 JACOBSON MICHAEL RICHARD Exercise 41,667 NA NA

Mar 06 02:08 PM

[Bob C:]

Smart vs Educated

My late father only had a 3rd grade education, due to circumstances beyond his control.

In 1950, at the age of 30, a freak accident took his eysight.

Even though totally blind for the rest of his 84 years of life, he, until his retirement, operated a couple of very successful businesses.

One of the keys to his success was treating employees, and customers alike with total heartfelt respect.

I do not believe the word 'respect' is even in eBay's dictionary.

I would put my dad's 3rd grade education, and worldly smarts up against John Donahoe's MBA education any day.

Mr Donahoe is blind also, but in a diffrent way than my father.

There is none so blind, as he who refuses to see.

Mar 06 04:23 PM

[Marcap:]

I'm not sure that eBay stock will ever go completely to zero, but I am confident that it will never again rise much above its current level...not until there is a complete change in management and its anti-seller policies are retracted, and of course Donahoe is shown the door. Only then will confidence in eBay begin to rise, and start it on the road to recovery. But until then, eBay sadly enough holds little value for its sellers, its buyers or its shareholders.

On Mar 06 11:20 AM NYM Arts wrote:

> Hi Scot,
> Just a Reminder :
> EBAY BOTTOM = ZERO
> Back Away Slowly.......

Mar 07 12:47 PM

[a. palmer jr.:]

I just don't understand why successful businesses want to change their operations just for change sake. Ebay was a very successful business and then they went and ruined it. I sold on ebay for awhile a few years ago and did very well considering I sold low priced items. I tried it again this year and the only one making any money was the Post Office. Ebay, and Paypal. I sold mostly items for around $20-$40. Postage was generally $10 and ebay and paypal taking around $7-$10. I would make a little money only if I acquired my sale item very cheap. I don't think it's worth it to try it this year unless a lot of changes are made.

Mar 07 06:59 PM

[frendz:]

179 comments that tells a lot about ebay, but how many people just remain silent? I reckon many many.

Mar 09 11:23 AM

[Marcap:]

Well stated Frendz.

That you can bank on. As always, these types of forums usually bring on some of the more radical people with their opinions, either for or against something. What can however be accurately derived from these comments is their general direction, either positive or negative. And once you have determined that, as you say, you can count on the fact that there are many many more...since what we see in public forums is more often than not, only a very small tip of the iceberg.

On Mar 09 11:23 AM frendz wrote:

> 179 comments that tells a lot about ebay, but how many people just
> remain silent? I reckon many many.

Mar 09 03:35 PM