eBay reaps the rewards of its strategic repositioning

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The giant California online sales eBay has regained its luster. He has published Wednesday, January 18, the annual results better than expected: sales up 27% to 11.65 billion dollars and net income, which jumped 79% to $ 3.23 billion .

A large share of the profits from the sale to Microsoft shares in the company Skype. For the first quarter 2012, despite an uncertain economic environment, the group expects a 20% increase in sales.

The strategic shift, which began shortly before 2010, seems to bear fruit. eBay, founded in 1995, was an air pocket, between 2005 and 2010, after years of wild growth. The site specializes in online auctions, has suffered from the distrust of the Internet, put off by the quantity of counterfeits sold to them.

Arriving in 2008 at the head of eBay, replacing Meg Whitman – now head of Hewlett-Packard – John Donahoe has launched three projects. He first negotiated the sale of Skype, the Internet telephony solution purchased in 2002, which the group found no synergies.

GENERALIST

Above all, Mr. Donahoe has sought to transform eBay into a general e-commerce: in addition to the auction site sells products at fixed prices and offers classified ads. “eBay has s’ adapt to the different methods of purchasing the web. Like Amazon, it has a good customer relationship management, and makes the difference with the competition ” , believes Olivier Rafal , of Pierre Audoin Consultants.

The acquisition in 2011 to $ 2.4 billion of GSI, a subcontractor of merchant websites – it manages the online sales of Ralph Lauren , for example – is part of this strategy.

The e-tailer has also developed PayPal. Acquired in 2002, this division, which specializes in online financial transactions, was first eBay method of payment for its proposed auction. She stepped up partnerships with other sites (22 000 in total) and now looks like a locomotive of the group in 2012, it would weigh 43% of revenues.

Like its competitors, eBay put on new modes of consumption: shopping in an online store via a mobile application, purchase in a shop “hard” with the phone as a payment terminal … “eBay needs to develop better mobile applications. For now, the interface is not as good as Amazon‘s ” , however, warns Lawrence Thoumine , the firm Kurt Salmon.