At least eBay (NASDAQ:EBAY) isn't taking this past quarter's 6% dip in global auction listings lying down. The leading online marketplace is going in for a makeover in the coming months, in hopes of setting itself apart from cheaper classified-listing sites by making the eBay experience more distinctive and enjoyable.
Yes, every retailer aspires to make its shop the hub of fun. That's the easiest way to keep shoppers from getting distracted by lower-priced options elsewhere. But it's a bigger challenge in cyberspace, where every competitor is just a click away.
eBay knows it can't compete on price. There just isn't enough ad revenue in following freebie outlets such as Craigslist, Google (NASDAQ:GOOG) Base, or even eBay's own Kijiji, to offset the listing fees and final transaction value fees that it currently collects. eBay may have to resort to this strategy in foreign countries, but its flagship business is too big a cash cow to send off to slaughter closer to home.
So what's in store for eBay? You don't need to guess. eBay offers a sneak peek at what's new and what's coming. Streamlining the "My eBay" landing page for registered members is a priority this year. The new layout will emphasize things to do within the next 24 hours, so as to make the site stickier and tempt you to check in daily.
More than just a spiffy home page
It doesn't stop there, of course. Bid Assistant is a tool that helps buyers bid more effectively. It automates the process by scouring through similar items, bidding on the best deal, and then switching over to a different auction if it is outbid and a better buy can be found elsewhere. In short, it acts as a virtual eBay busybody while you're out doing something else.
It's a neat tool, until you realize that eBay stands to gain plenty if it is populating its site with automated bidders. It may not necessarily drive final selling prices higher, but it will likely lead to having more auctions close successfully.
Another intriguing wrinkle in the eBay game plan is Playground, an eBay site that mirrors the auction marketplace but is a test lab for new merchandise-searching strategies. If you're up for slapping on the guinea-pig suit, the Playground is there to help the company figure out what works and what does not.
You also have the eBay To Go application that makes it easy to promote your own listings -- or items that you find interesting -- on third-party websites, blogs, and social-networking profile pages. How? Well, it uses the same embedded JavaScript gimmick that has made Google's YouTube, News Corp.'s (NYSE:NWS) Photobucket, and even Amazon.com's (NASDAQ:AMZN) Associates affiliate marketing program so successful. Just copy and paste the generated lines of code into your non-eBay cyberspace presence template, and it will update itself for you.
And speaking of social networking, let's not forget that eBay is trying to nurture like-minded eBayholics through its MyWorld feature. If you're willing to reveal a little bit about yourself, eBay can hook you up with folks who have similar hobbies or even an affinity for your favorite movies or television shows.
Making a stickier community is important. It keeps users coming back. Even if that means you are ultimately competing against a virtual friend to bid up that Hank Aaron baseball card -- something that eBay doesn't mind, of course -- it's a way to weave eBay deeper into your life.
Meg Whitman is Willy Wonka
You get the feeling that the eBay lab is full of sudsy bubbles, chocolate-churning waterfalls, and Oompa Loompas ready to break out in song. But turning eBay into an everlasting gobstopper -- that one sweet treat that never loses its flavor -- won't be easy.
eBay's sneak peek offers glimpses into other new features that are on the way. The "1 click bid" option will allow logged-in users to track last-minute bids on an item they covet without having to hit the refresh button over and over again. eBay Countdown is another enhancement, popping up on your screen as the clock ticks down on items that you are watching or actively bidding on. Let's just hope that it doesn't come with the cheesy second-ticking sound effects that you find on 24 -- though I imagine it won't be long before eBay apes the hit show to give you split-screen views of several items you're interested in, as they all count down with the "1 click bid" feature enabled.
Then you have Window Shopping, through which a product or category search can take you to a page full of photos and video clips of available items. It's not a perfect solution, especially with so many auctions that don't include digital snapshots, but it's a refreshing way to replicate the real-world shopping experience.
Not every feature will be a hit, but that's OK. If one or two new gimmicks prove enduring, they may be just the ticket to reversing the troubling trend of the slowdown in listings.
"Don't write off eBay," I noted in covering last week's quarterly report out of eBay. Perhaps a better way to look at it is to approach eBay as a way to appreciate the future that has yet to be written.
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Longtime Fool contributor Rick Munarriz is a satisfied eBay user, with 172 positive feedbacks to show for it. He does not own shares in any of the companies in this story. He is also a member of the Rule Breakers analytical team, seeking out the next great growth stock early in its defiance. The Fool has a disclosure policy.
