E-commerce is evolving too rapidly for many merchants to keep up, and eBay, having acquired several technology companies, can be a valuable partner for retailers, Christopher Payne, president of North America for eBay Inc., said today in a keynote address at the Internet Retailer Conference & Exhibition 2011 in San Diego.
“Merchants need a partner, not a competitor,” Payne said. “Because of the pace of change it’s very difficult to do this alone. We’re in a great position to bring this partnership to merchants of all sizes.”
“This was the strongest I’ve seen eBay deliver the message that ‘We will not compete with you’,” commented Scot Wingo, CEO of ChannelAdvisor Corp., which provides services to e-retailers selling on online marketplaces like eBay and Amazon. “He was clearly calling out Amazon.” Wingo notes that both Amazon.com Inc. and eBay now offer merchants a range of services, from marketing to fulfillment, and that eBay is hoping to woo retailers by pointing out that eBay, unlike Amazon, does not sell on its own behalf and thus does not compete directly with retailer clients.
The reference was not just to Amazon, as other online retailers are creating marketplaces and competing with sellers on those sites, Payne noted in an interview after his speech. Merchants that have online marketplaces include Buy.com, Walmart.com and Sears.com.
But speaking of the Fulfillment by Amazon, an Amazon service that delivers orders for sellers on Amazon.com that choose to participate, Payne said, “It’s a fundamental conflict of interest to give your inventory and data intelligence to your No. 1 competitor. That’s a conflict we don’t have.”
Payne described eBay’s recent announcements of plans to acquire e-commerce technology companies, notably GSI Commerce and Magento. He said their technology resources and those of other acquired companies will be combined with eBay and PayPal technology to offer retailers a suite of software and services from a new unit of eBay called X.Commerce, which the company announced last week. He promised more details about X.Commerce at a developers conference eBay is planning for October in San Francisco.
Payne devoted much of his talk to describing the big changes in retailing in recent years brought about by the rapid development of mobile commerce, social marketing and the emergence of online systems for making local offers and showing inventory available in local stores.
EBay has been experimenting in all these areas, he said. He pointed to a new service now being tested called Fetch that ties into the Milo service eBay acquired last year that provides online information about inventory available in local bricks-and-mortar stores. Fetch allows the many small retailers that use Intuit’s QuickBooks Point of Sale software to keep inventory records to upload that data to Milo, enabling eBay to expose a retailer’s inventory to the 95 million active eBay customers. Payne said retailers can sign up to participate at http://milofetch.com, and that the service is free during the beta test.
In fact, Payne said later, the Milo service is free for merchants, as eBay tries to build up the inventory information it can offer consumers. “Ultimately, we think there’s enough value for merchants that we’ll build a business model,” he said. “Right now is not the time to do it.” He added that consumers are using RedLaser a bar code scanning mobile app that lets consumers access Milo’s product and inventory data. Consumers have downloaded RedLaser 9 million times, far more than the 2 million downloads that had taken place when eBay acquired RedLaser in June 2010.
Payne also pointed to a new feature that eBay plans to introduce in the second half of the year that lets consumers show friends items they’re considering buying and get feedback and suggestions from others, including Facebook friends if a consumer consents to connect to the social network though eBay. “Social will have a transformational impact on shopping,” Payne said. “The key is to begin to experiment.”
Payne said eBay is pouring money into such experimentation. “Most merchants can’t invest in all these changes, but we do,” he said. “We’re investing over $1billion in technology annually to build out the next generation of product and services, and to figure out what will work.”
In a conversation after the speech, Payne said mobile is becoming established, and it’s clear to him the path for uniting local retailing and the web by providing inventory information to online and mobile shoppers. “That’s something customers want,” he said.
On social, however, the jury is still out, he said. Putting a store on a retailer’s Facebook page doesn’t solve a problem or seem compelling, as the retailer’s e-commerce site is just a click away. He says eBay will continue to experiment with features like social shopping and a group gifting feature that lets friends and relatives pool their money online, using eBay’s PayPal payment service, to buy a gift. “We all think social can be transformative of commerce,” Payne said. “But how that’s going to happen, I don’t know.”