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eBay is on the upswing (EBAY)

Published by Business Insider on Fri, 27 Jan 2017


This story was delivered to BI Intelligence "E-Commerce Briefing" subscribers. To learn more and subscribe, please click here.In its Q4 2016 results, eBay noted sustained growth across key metrics, and in particular, a strong performance in various categories over the holiday season as legacy retailers fell flat.For eBay, finding new ways to grow and develop in a competitive and consolidating e-commerce market are key, and the fourth quarters results seem to point to a strong start in that direction.GMV: The firms GMV grew by 3% year-over-year (YoY) in the quarter, to hit $22.3 billion. This marks consistent GMV growth through all of 2016.Revenue: eBays revenue grew by 3% YoY, totaling $2.4 billion in Q4. Revenue declined through 2015, and was flat in early 2016 before returning to growth in Q3, so sustaining those gains is a good sign that the firm is finding a path to success.Active buyer growth: The firm had 167 million active buyers in Q4, up 3% YoY. Even more, the firm is more effectively retaining and re-activating buyers, which could point to better trends moving forward.These are signals that the companys new initiatives to rejuvenate its growth are going well.In 2015, when eBay spun off PayPal, it lost its major growth engine, according to CNBC. Thats caused the firm to take on some new initiatives, including doubling down on structured data, focusing less on auctions and more on direct sales, and adding segments like StubHub. The firm also began advertising on TV for the first time in two years to hit millennials and other segments more effectively. Sustained numbers, as well as strong growth in key markets, point to a better 2017 for the company.Thats only true if eBay can manage to keep pace, though. The e-commerce market is expanding rapidlyBI Intelligence expects it to hit $631 billion in 2020, up from $341 billion in 2015. And eBay has considerable competition, like Amazon and Walmart, which recently bought Jet.com. According to Bloomberg, in order to continue growing, the firm will need to find ways to sustain innovation or acquire other companiesor itll be left behind as existing and emerging players continue to break out and capture market share.It's clear that eBay's e-commerce strategies are paying off, but online retailers must continually evolve in order to maintain that growth.BI Intelligence, Business Insider's premium research service, has compiled a detailed report on new e-commerce strategies that looks at some of the top trends affecting retailers at each stage of the purchase funnel and how they're responding to those shifts.Here are some of the key takeaways:Within digital, consumers are spreading out their retail purchasing across channels, forcing retailers to spread out their online marketing budgets. Paid search, affiliate marketing, and email all increased their share of e-commerce referrals last year, according to Custora.Paid search especially stood out as a major source of spending by retailers. Search ad spending grew 18% YoY in Q4 2015, according to IgnitionOne.Mobile continues to drive the most sales growth for retailers, but sales still aren't keeping up with retail traffic. IBM found that smartphone traffic beat both tablet and desktop, making up 53% of all online traffic. But mobile still only accounted for 29% of all online sales.Retailers only have themselves to blame for underperformance on mobile, as many still aren't using best practices for mobile websites and apps. Only 60% of the top 100 global retailers currently have a dedicated mobile website, according to The Search Agency.The increase in online shopping has put stress on the shipping and logistics industry. The number of UPS ground packages delivered on time during the holidays fell from 97% in 2014 to 91% in 2015, according to ShipMatrix.Retailers are beginning to explore alternative shipping options. Earlier this year Gilt Groupe switched its primary ground shipper from UPS to Newgistics.Retailers that can't afford to invest in alternative shipping options are offering consumers more fulfillment options using what many of them do havebrick-and-mortar stores. Buying online and picking up in-store, also called click and collect, made up about 30% of e-commerce sales at Sam's Club in 2015.In full, the report:Looks at how retailers are shifting their ad spending and marketing efforts to keep up with online retail behaviorIdentifies which channels are top performers for referral traffic and new opportunities for reaching consumersAnalyzes how retailers are responding to the rise of mobile purchasing and where they're falling shortExamines the evolving delivery landscape and the aggressive moves retailers are making to become their own shipping carriersTo get your copy of this invaluable guide, choose one of these options:Subscribe toan ALL-ACCESS Membership with BI Intelligence and gain immediate access to this report AND over 100 other expertly researched deep-dive reports, subscriptions to all of our daily newsletters, and much more. >> START A MEMBERSHIPPurchase the report and download it immediately from our research store. >> BUY THE REPORTThe choice is yours. But however you decide to acquire this report, youve given yourself a powerful advantage in your understanding of new e-commerce strategies.Join the conversation about this story
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