eBay Watch: Alibaba Stake, U.S. Store Promotion, e-Commerce and GMVs

Jack Ma & Softbank Smell Blood

It is becoming increasingly clear that Alibaba Chairman Jack Ma and Softbank (SFTBF) are interested in exercising their right of first refusal over Yahoo's (YHOO) 39% stake in Alibaba Group should Microsoft's (MSFT) bid for Yahoo succeed. As I mentioned a while back, they obviously want to pick their own partner to maximize value. This raises lots of questions over how the stake would be valued, how Microsoft would react, and whether eBay (EBAY) might get involved in the fray. One thing is for sure, the dynamics of this deal keep on getting more interesting.

Update: I found an interesting quote from the San Francisco Chronicle back in 2006. "Among China's leading businessmen, Ma is known for his bombastic comments. He routinely uses eBay as a dartboard while simultaneously praising it as one of the companies he most admires."

eBay Promoting U.S. Stores

eBay has announced a 30-day trial promotion for opening a new eBay store. Read details of the promotion here.

In the U.S., estimates show store listings have grown 17% Y/Y QTD and this growth has accelerated since the fee structure changes went into effect. I suspect with the roll-out of best match, we may start to see eBay give store listings even more exposure within the system again.

eBay Enabling More E-Commerce Than Ever

click to enlarge

This is a graph of the Gross Merchandise Value [GMV] that has flowed through eBay GMV Marketplaces every quarter since 2001. Seven years of almost perfectly linear growth obviously takes a toll on growth rates, but it still does not negate the fact that eBay is connecting more buyers and sellers than ever before (and this excludes non-GMV businesses such as classifieds or comparison shopping). In Q4 2007 alone, a record $16.2 billion of GMV traded hands through eBay Marketplaces while GMV growth stabilized around 12.5% Y/Y.

Even though GMV is becoming a less all-encompassing metric because of eBay's diversification into non-GMV activities, it is still the most important measure of health, representing the base on which about 50% of PayPal revenue and 85% of Marketplaces revenue is generated. Which is why it is reassuring that in Q1 2008, indications are that we will see yet another quarter of record GMV and a very welcome acceleration in Y/Y growth.

Comments

[whoiskiddingwho]

Wow, someone's been drinking the koolaid today!

More eBay PR waffle as usual.

What on earth has GMV growth to do with the ill perceived success of eBay?, yes more value MAY have been sold, but that is not eBay inventory, in reality all they sell (and they do that VERY poorly) is bandwidth and a search engine which belongs in the 20th century, now weighted so much towards worst match that buyers won't even get as far as a "buying experience' because the widget they are looking for is hidden among a gazillion cheap cellphone accessories etc.

The buyers (who are the seller's buyers, not eBay's) will just click the back button when they don't immediately find their widget on a search and go search at other online stores via the base.google.com framework. So assuming the GMV figures are correct, well done to those sellers.

What SHOULD have happened to give a positive outlook is that Y/Y growth increased rather than taking an almost linear % decrease. Someone want to tell me how a non existing inventory value increase is more important to a (non)service company than actual market penetration growth?

EBay needs to accept the fact that their ONLY customers are sellers (buyers don't add a dime to eBay coffers as a stand alone group), and we all know about the sad relationship that eBay is now perfecting with it's sellers. Perhaps, if eBay was to concentrate on a "good seller experience", they would see real Y/Y growth and not this huge exodus to alternate sites of the long term sellers, surely they realize that you can't replace the ones who are leaving with a bunch of new, inexperienced sellers and expect EITHER GMV or Y/Y growth to increase.

[InnocentObserver]

Wow. I read many of these articles and it is very interesting to see how entitled a few sellers feel. It's too bad they feel so left out. I guess it is true that most people fear change. It's unfortunate that they feel the only thing they can do now is bitch and moan. Everyone has an opinion I guess. Remembering some sage old advice, "Who ever said life was fair was lying," I'm left feeling like there's a group of people that just like to complain. Life is to short to be negative, go have some fun.

[pennsylvania-antiques]

Well it sounds to me like the last poster has nothing to do but complain about people complaining - probably another ebay employee.

I'm one of the founding sellers who is leaving and I'm not complaining- just selling a lot on other sites.

[John Capozzi]

ALLIBBA & SOFTBANK SHOULD TEAM UP AND BUY YAHOO USA AND RECEIVE THE FUNDING FROM THE CHINESE AND JAPAN GOVERNMENT. THIS WOULD GIVE THEM GREAT POTENTIAL IN ASIA AND INDIA WITH NO ANTI TRUST PROBLEMS. They could also pay 45 to 50 dollars a share for Yahoo usa it would be like investing in themselves and would open many door even a merger with NT&T and getting into the wireless smart phone business going against apple nokia and verisign and at&t and this would make them a powerhouse in asia and india and have them mix in nicely with the culture arena and again be more welcomed then microsoft, google or apple. The Chinese government funded the IBM PERSONAL COMPUTER BUSINESS TO LENOVA WHY NOT ALLIBBA AND SOFTBANK? THIS WOULD BE A GREAT MOVE AND SAVE JOBS IN THE USA AND IN ASIA. THIS WOULD BE ONE HELL OF A GIANT COMPANY. EVERYONE KNOWS THE MAJOR MONEY WILL BE MADE IN ASIA AND INDIA GOING INTO THE YEAR 2010 AND YAHOO, SOFTBANK AND ALLIBBA HAVE SET THEIR FOOT PRINTS ALREADY. I HEARD THIS WAS BEING LOOKED AT ALREADY I A CHNINESE NEWS LETTER PLUS IT HAS BEEN MENTIONED MANY TIMES THAT SOFTBANK AND ALLIBBA HAVE BEEN IN DAILY TALKS SINCE THE MICROSOFT BID WAS MADE. MICROSOFT BETTER MAKE A 45 TO 50 DOLLAR A SHARE FINAL BID OFFER BEFORE THE WEEKEND CLOSE BECAUSE EBAY HAS BEEN MOVING MORE IN THE TALKS AND COULD EASILY BE SUCKED UP INTO THE NEW BUSINESS OR AS WE CAN CALL IT THE NEW YAHOO. IF MICROSOFT DOES NOT MAKE A MOVE THIS WEEKEND IT LOOKS VERY LIKELY THEY WILL EVEN BE CRUSHED BY GOOGLE BY THEM BUYING OUT THE 39% SHARE PRICE YAHOO USA HAS IN ALLIBBA FINALLY NAILING THEIR COFFIN FOR ADVANCEMENT IN SEARCH AND ADD. YOU'LL SEE MICROSOFT IS NOT DUMB. THEY WILL HAVE TO RAISE THEIR BID ABOVE 40 B THE END OF THE LONG WEEKEND OR THERE WILL BE A BG CHANGE IN THE INDUSTRY BY MONDAY MORNING WHICH WOULD INCLUDE EBAY. MICROSOFT WILL LOSE THEIR ONLY CHANCE. HA! GO AFTER AOL GO AHEAD MICROSOFT. AOL WILL NEVER BE ON THE MAP AGAIN YOU USE SEARCH FOR AOL NOW YOUR COMPUTER AUTOMATICALLY MOVES YOU TO GOOGLE . MICROSOFTS TIME HAS RUN OUT AND YAHOO OPENED THEIR BOOKS LAST WEEK AND SHOWED THEIR POTENTIAL WITH AN SEC FILING. MICROSOFT NEEDS TO MOVE THIS WEEKEND!