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Shopper-friendly moves made eBay a recession victim

Kevin Kelleher presents an interesting theory on how eBay stopped being recession-proof.

Seeking to increase sales, eBay initiated changes earlier this year that made it a safer and more orderly place for people to buy products online. In doing so, however, eBay may have made itself more vulnerable to the effects of the current recession.

During the recession of 2002, eBay stock performed exceedingly well against the Nasdaq. But the numbers are reversed during this current recession. In fact, statistics indicate that while online traffic generally went up during the first week of December, eBay’s traffic tumbled 9%.

Kelleher speculates that eBay’s recent strategy shift may have taken itself out of the “small pond” of online auctions where it was the “big fish,” and transplanted itself as yet another competitor it in the more cutthroat market of online retail.

Should eBay have stayed focused on auctions? Tell us what you think.

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2 Comments Add your comment
I think that the sellers drive for new products has also played a role over time. Drop Shipping is always a popular option for two reasons, it is deemed to be inexpensive, and it's the lazy way out! The secondhand market is seriously undervalued by the majority it seems. If you don't have something new to sell, then you can't make money What a load of rubbish, the right secondhand goods sell the house down on ebay, and it's because buyers are so weary about fakes and drop shipped products. Ebay started out life as a secondhand market place, but products now reflect that of an online retailer. Perhaps they are becoming a victim of their own success with the site being saturated with new items. Reply
That's an excellent point fudjj, thanks. Reply
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