Exploiting the Internet, Opportunities for New Business
IIA, Westmeath CEB, Athlone
John McElligott
October 2006
About eBay
eBay is the 21st century marketplace
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eBay Inc.
eBay Marketplace Business
Marketplace mission: create the world’s online marketplace
• Provide a global online trading platform where practically anyone can trade
practically anything
• Sellers create listings of products for sale
– Listing fee as low as €0.20, small commission if item sells
– Items listed by individuals, SMEs, large businesses or charities on same terms
(“level playing field”)
• Buyers can search, purchase and make payment
– Thousands of categories of items
– Auction-style format or fixed price (“Buy It Now”)
• eBay acts to facilitate safe transactions and create transparency
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eBay is based on feedback
•
Goal to create open, transparent marketplace
•
Seller Information Box includes details about the seller, including feedback
score
• Feedback
page shows
detail of
comments
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eBay Values
eBay was founded on five key values
• We believe people are basically good
• We recognise and respect everyone as a unique individual
• We believe everyone has something to contribute
• We encourage people to treat others the way they want to be treated
• We believe that an honest, open environment can bring out the best in people
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Welcome to the Community
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Find What You’re Looking for
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Get the Details
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Transact
Buyer
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Seller
Fast Facts
• 203 million registered users worldwide
– At time of eBay.ie launch in June 2005 there were over 200,000 in Ireland
– eBay.co.uk passed 15 million users in April 2006
• At any time, there are 104 million items worldwide
– More than 50,000 categories on eBay
– Approximately 6.5 million items added per day
• As of April 2006, eBay members had left more than 4.5 billion feedback
comments for one another regarding eBay transactions
• Approximately 1.3 million sellers use eBay as a primary or secondary
source of income
– More than 724,000 professional sellers in the U.S.
– More than 170,000 professional sellers in Europe
Source for number of professional sellers: AC Nielsen. All other metrics based on eBay data.
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Fast Facts (continued)
• In Q2 2006, the value of all goods traded was US $12.9 billion
• eBay users worldwide trade more than US$1,640 worth of goods on the site
every second
• Based on Q2 2006 GMV, the following categories delivered US $1 billion or
more in worldwide annualized GMV:
– eBay Motors at $17.1 B
– Collectables at $2.3 B
– Clothing & Accessories at $3.9 B
– Business & Industrial at $1.9 B
– Consumer Electronics at $3.7 B
– Toys at $1.7 B
– Computers at $3.5 B
– Jewellery & Watches at $1.7 B
– Home & Garden at $2.9 B
– Cameras & Photo at $1.4 B
– Books / Music / Movies at $2.6 B
– Antiques & Art at $1.1 B
– Sports at $2.5 B
– Coins & Stamps at $1.0 B
• Fixed-price formats accounted for 35% of total GMV during Q2 2006
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eBay GMV (US $)
$44.3 B
81% CAGR
$34.2 B
$23.8 B
$14.9 B
$9.3 B
$0.7 B
1998
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$2.8 B
1999
$5.4 B
2000
2001
2002
2003
2004
2005
Category Expansion, new and used items
Breadth
Categories
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Depth
Why Run a Business on eBay?
Irish Seller: irish-celt (4819 )
• Registered on eBay since: 1998
• Location: Milltown Malbay, Co. Clare
• Selling: postable antiques
• Seller vignette
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eBay’s Addressable Market is Large
Inefficient
markets
new/scarce
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Highly efficient
markets
in-season retail
Less efficient
markets
end-of-life
used/vintage
Benefits as a Business Channel
• Reach
– Can reach a market of 203 million eBay users
– Over 200,000 eBay users in Ireland; over 15 million users in UK
• Business profitability
– Low transactional costs
– Can reduce or replace many of the traditional costs of doing business (e.g. premises,
advertising)
• Safety and reputation
– Can build a reputation using feedback and comments
– Safe, easy payments via PayPal
• Ease of use
– Listing and promoting items is easy
– Several tools to facilitate selling (e.g. Turbo Lister)
– Can use eBay as an alternative, or occasional channel
• Support
– Prioritised support for businesses and leading sellers
– On-line help resources
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Access to Large Global Buyer Base
Populations
Athlone
16,000 (1)
Midlands Region
279,137 (1)
eBay.ie Registered Users at launch
eBay.co.uk Registered Users
> 15,000,000 (3)
eBay Europe Registered Users
> 50,000,000 (4)
eBay Global Registered Users
203,000,000 (5)
(1) Source: IDA Ireland.
(2) eBay.ie Registered Users as of June 2005.
(3) eBay.co.uk Registered Users as of April 2006.
(4) eBay Europe registered users as of April 2006.
(5) eBay global registered users as of June 2006.
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eBay Inc.
> 200,000 (2)
Low Transaction Costs
Insertion Fees
Subscription Fees
Starting or Reserve Price
Insertion Fee
€ 0.01 – € 1.49
€ 0.20
€ 1.50 – € 6.99
€ 0.30
€ 7.00 - € 19.99
€ 0.50
€ 20.00 - € 44.99
€ 1.00
€ 45.00 - € 149.99
€ 2.00
and up
€ 3.00
Shop Format
Fee
Basic
€ 8.95 / month
Featured
€ 19.95
Anchor
€ 99.95
Final Value Fees
Closing Price
Final Value Fee
Item not sold
No Fee
€ 0.01 - € 44.99
5.25% for the amount of the high bid (at the listing close for auction-style listings) up to € 2.36
€ 45.00 - € 849.99
5.25% of the initial € 44.99 (€ 2.36), plus 3.25% of the remaining closing value balance up to € 26.16
Over € 850.00
5.25% of the initial € 44.99 (€ 2.36), plus 3.25% of the initial € 45.00 - € 849.99 (€ 26.16), plus 1.75% of
the remaining closing value balance
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Example Fee Totals
• For an item that starts at €0.01 and sells for €30.00
Listing Fee (€0.01 - €1.49)
€0.20
Final Value Fee (5.25% of total)
€1.58
Total
€1.78
eBay Fees as % of Total
5.9%
• For an item that starts at €0.01, has reserve of €500 and sells for €900
Listing Fee (fee based on Reserve Value of €500)
€3.00
Final Value Fee
€29.40
Reserve Fee (2% of reserve price)
€10.00
Total
€42.40
eBay Fees as % of Total
4.7%
• Margins can increase by using multiple item fixed price or Shop Inventory Format to
promote your items
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What Can You Sell?
• You can sell practically anything on eBay.ie,
as long as it is legal
• Specific listing policies provide users with
guidance
– http://pages.ebay.ie/help/sell/questions/prohibit
ed-items.html
– All eBay users are bound by these policies,
which are updated as appropriate
• There are some variations in listing policies
between eBay sites due to local laws and
obligations
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Getting started – Feedback
• Feedback is an essential enabler of trade on the eBay platform
– It is the primary method for our members to protect themselves and make
informed decisions before bidding or buying
• What is it?
– Every member has a reputation based on feedback
– Personal opinion comments from other members for transactions with positive,
neutral, or negative rating
– Feedback score is a count of positive ratings minus negative ratings from unique
members
– Each member can affect another’s score by a net of +1, 0 or –1
– Coloured feedback stars attained at various levels
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Feedback System – Generating Trust
• Goal to create open, transparent marketplace
• Seller Information Box includes details about the
seller, including feedback score
• Feedback
page shows
detail of
comments
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PayPal – Safe, Fast, Convenient Online Payments
How PayPal works – 4 steps
Sender
1.
Customer clicks on PayPal link.
Benefits of using PayPal
• Safe and secure
Customer logs in and enters
payment amount.
2.
• Fast
• Easy
Receiver
3.
Seller gets electronic notification of
funds received and delivers goods.
• International
• Buyer protection
• Cost effective
Seller can withdraw funds or send
payment to another customer.
4.
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eBay Inc.
Quick Facts
• Global leader in online payment solutions
• PayPal has 114 million total accounts, is available in 55 markets and
in seven currencies
• PayPal has over 10 million accounts in the UK
• PayPal transacted about $1,126 in total payment volume every
second in Q2 2006.
• PayPal established its international headquarters in Dublin in 2003
• PayPal is a safe way to pay online and maintains a very low loss rate
due to fraud – 0.29%, or less than one third of one percent.
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Return Policy
• Many sellers allow the return of items sold
– Business sellers must provide customers with
a period of seven working days after receipt
– Many individual sellers honour similar terms as
good business practice
• eBay facilitates communication of a seller’s
policy through:
– Seller tools
– Standard placement on item listings
• Stating a clear return policy creates
transparency and reinforces buyer trust
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Free Calling and “Skype Me”
Why is it so great?
Skype lets you talk through the Internet …
for free.
You can also make very low cost calls to
phones around the world
Download Skype at www.skype.com.
Contact eBay buyers and sellers using
Skype – testing in select categories
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•
Free unlimited worldwide calling to other Skype
users
•
Low cost calls to international landlines and
mobiles (e.g. $0.02/ min to New Zealand)
•
Superior sound quality
•
Videoconferencing
•
Easy to use
Tools to Support Efficient Selling
Turbo Lister
Listing Creation
& Selling Manager
Selling Manager Pro
√ TL
√
Inventory Control
√
Restock Alerts
√
Monitoring Real Time Sales
√ SM
√
Emailing Buyers
√ SM
√
Invoicing Buyers
√ SM
√
√
Automating Processes
Sales Reporting
√ SM
√
Cost
Free
€ 6.99 / month
(30 day free trial)
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Automation with Selling Manager Pro
• Many selling processes can
be automated with Selling
Manager Pro:
– Listing creation
– Contacting buyers
– Invoicing
• Sellers can tailor their own
selling strategies by month,
quarter or seasonally
• Good value for business
sellers
– Free with Featured or
Anchor Shops subscription
– €6.99 per month otherwise
Third party tools (e.g. ChannelAdvisor) also available to serve large sellers
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Maximise Visibility – eBay Shops
• Unique look and presence
• Customise colours and branding
• Extra promotion and recognition
• Control what you cross-sell
• Data on visitors to your Shop
• Shop-only format with lower
insertion fee, longer listing
duration
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Sales Reports and Sales Reports Plus
• Can be used to tailor
market approach
• Provides sales
information by
category, day,
format, ending times
• Also compares ASP
• Sales Reports are
Free
• Sales Reports Plus
offers more detail
– Free with Shops
subscription
– €4.99 per month
without Shops
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Select the Right Delivery Services
• Postage, courier and delivery market is de-regulating; new options are
continually available
• Providers can offer differentiated services, such as tracking, guaranteed
delivery and volume discounts
• GLS are building out a network of “Parcel Shops” around Europe ~ 50 in
Republic of Ireland to date
• Optimum solution may involve different providers for posting to different
regions
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Become an Effective Business Seller – Top Tips
• Include search keywords in your title
and write a complete, accurate
description
• Sell internationally and specify postage
costs for multiple jurisdictions
• Include a clear and buyer-friendly
return policy
• Become more efficient and organised
with the right seller tool for you
• Offer PayPal as a payment option for
ease, speed, buyer peace of mind
• Take your feedback rating seriously –
it’s your brand!
• Consult the Business Centre
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Education Resources
• eBay Explained
– eBay Tour, how to buy, sell, use My eBay, etc.
– http://pages.ebay.ie/help/ebayexplained/
• Community & chat boards
– Member to member help, discussion boards,
interest groups
– http://pages.ebay.ie/community/
• Business Centre
– Advice for business sellers
– http://pages.ebay.ie/ebaybusinesscentre/index.
html
• Safety Centre
– Safety tips & problem reporting
– http://pages.ebay.ie/safetycentre/
• eBay Events
– eBay University, IIA/CEB & other events
– http://www.ebay-events.ie/
• Site help and contact Customer Support
– http://pages.ebay.ie/help/index.html
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Free Business OnRamp Support
•
Service to assist businesses with becoming sellers on eBay.ie
– Expert consultation with a member of our specialist Business team
– Support through the process of getting started
– Advice on how to make the most of your eBay selling
•
How to take advantage
1. Register as a seller on the eBay.ie site
2. Once you have registered, send email to IrishBusiness@eBay.com with the
following:
– Your eBay user ID
– Best contact telephone number, with voicemail if possible
3. We will arrange a time for the Business Onramp consultation, generally can
schedule within two weeks
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eBay in Ireland
eBay.ie Business History
• May 2004: Tánaiste and Minister for Enterprise, Trade and
Employment Mary Harney TD officially opens eBay’s Irish offices
– European CS centre and PayPal’s international headquarters
• June 2005: Launch of eBay.ie to give Irish eBayers their own
marketplace
• July 2005: Wanderly Wagon’s Judge appointed eBay Security
Watchdog
• September 2005: First eBay University in Ireland
• November 2005: Launch of eBay Motors Ireland to facilitate trade
of vehicles, parts and accessories
• March 2006: eBay announces expansion of Irish operations
– >900 employees in Ireland, plans to create >300 additional jobs
• July 2006: eBay and O2 partner to launch eBay Mobile
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eBay Mobile
• Launched in partnership with O2
• From i-mode phones users can:
–
–
–
–
Search
View simplified listings
Bid and buy
Also available at www.ebaymobile.ie
• Ad campaign in summer 2006
– Print ad in June O2 magazine
– Co-branded TV ad launched July 2006
– Co-branded radio ad launched August
2006
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Education – Events
• eBay.ie sponsors and participates in local events
• Goals: further education on e-commerce and eBay as a platform to enable
business
• Recent and upcoming events:
– eBay University, Dublin: 12 September 2006
– Generating Revenue for Your Website, Tullamore: 14 September 2006
– Facilitating Broadband Leadership, Dublin: 21 September 2006
– Exploiting Business Opportunities on the Internet, Carlow: 5 October 2006
– eBay University, Limerick: 10 October 2006
– Exploiting Business Opportunities on the Internet, Athlone: 19 October 2006
– National IT and e-Security Summit, Dublin: 9 November
– Exploiting Business Opportunities on the Internet, Dún Laoghaire: 23 November 2006
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Charity Fundraising
eBay.ie works directly with Irish charities to help promote fundraising and
awareness, offering unique items and experiences
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Select Irish Charities Featured To Date
Action Aid International Ireland
Fermoy Lions Club
Irish Wheelchair Association
Bóthar
GOAL Ireland
Kildare Town C.Y.M.S.
Brothers of Charity Svcs. Galway
Irish Autism Action
Leprosy Mission Ireland
Cystic Fibrosis Assn. of Ireland
Irish Cancer Society
To Russia With Love
DEBRA Ireland
Irish Heart Foundation
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Velocity of Trading – Irish Buyers
On an average day…
An Irish buyer purchases an auto part every 5 minutes
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Velocity of Trading – Irish Buyers
An Irish buyer purchases a DVD every 4 minutes
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Velocity of Trading – Irish Buyers
An Irish buyer purchases a collectible every 2 minutes
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Velocity of Trading – Irish Buyers
An Irish buyer purchases an item of clothing every 2
minutes
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Velocity of Trading – Irish Sellers
In Q3 2006, an Irish buyer buys 3 items across all
categories every minute of every day
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Velocity of Trading – Irish Sellers
An Irish seller lists a collectible for sale every 5 minutes
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Velocity of Trading – Irish Sellers
An Irish seller sells an item in music every 4 minutes
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Velocity of Trading – Irish Sellers
An Irish seller sells an item in computing every 4
minutes
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Velocity of Trading – Irish Sellers
An Irish seller sells an item across all categories every
minute
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Case Studies
Irish Seller: fion7252 (33
• Started selling in July
• Clearing out her closet
– Clothes
– Shoes
– Accessories
– Handbags
• “Everyone has something to sell”
• Part-time seller: cash for unwanted
items for a bit of spending money
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)
Irish Seller: emerald-isle-stamps-shop (1682
• Former computer programmer,
decided to set up his own business
on eBay after returning from travel
• Dedicated eBay store covers all
aspects of Irish philately & coinage
as well as stamps from around the
world
• Also acting as an agent for other
businesses to sell on eBay – means
he can keep stock to low levels
• Close to selling the amount needed
to make a full-time living
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)
Irish Seller: esmescards (2386
• Individual “PowerSeller” working from
home in Gorey, Co. Wexford
• Selling homemade cards and imported
materials for making cards
• Items sold through eBay to a worldwide
market of buyers
• Profits from eBay selling have enabled
her to earn a living and work her way off
of state benefits
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)
Irish Seller: luzerntech (17639
• Business employing ~40 people in
Blanchardstown
• Separate user IDs selling to Ireland,
UK, Germany, Spain, France, Italy
• Full service business selling on behalf
of manufacturers (e.g. Palm, In Focus,
Lexmark)
• Sells returned and refurbished PDAs,
printers, home cinema, projectors, etc.
• Vast majority of sales are through
eBay, with a fraction on own website
• Plan for >€1 million in monthly eBay
sales by end of 2006
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)
Irish Seller: bohemianfootballclub (41 )
• Registered on eBay since: 2005
• Location: Dalymount Park, Dublin
• Selling: soccer jerseys and memorabilia
• Seller vignette
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Useful Links
• Registration
• Community and Chat Boards
• eBay.ie Business Centre
• eBay Ireland Trading Message Board
• eBay Explained
• Seller Tools Finder
• eBay Selling Explained
• Judge’s Safe ‘Surf’ Code
• Site Help/Contact eBay Customer
Support
• Safety Centre
• Fees
• eBay Shops
• PayPal
• eBay Toolbar
• User Agreement
• Listing Policies
• Contact PayPal Customer Support
• eBay Verified Rights Owner (VeRO)
Programme
• Skype
• eBay Events
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Summary
• Marketplace offering vast breadth and depth of items to buyers
• Great way for sellers to reach vast customer base across Ireland – and the
globe!
• Low cost of transacting
• Easy, affordable, secure payment processing with PayPal
• Advanced tools and Shops to support growing a business online
• Businesses: arrange for an on-ramp consultation call at
irishbusiness@ebay.com
• Other questions? Contact me directly at john.m@ebay.com
• Thank you!
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