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eBay shows the effects of lockdown on its business

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eBay this week said it was seeing the effects of lockdown on its business. Its marketplaces were seeing demand surge, but its classified advertising platforms had been hit as car dealers closed and advertising slowed more widely. 

eBay also says it has removed or blocked more than 15m listings in order to make sure its platform remains safe and trusted. Among the listings that have been blocked were those making false health claims or offering products for inflated ‘price gouging’ sums. 

“From the start of the quarter through mid-March our underlying business performance was better than our expectations,” said eBay in this week’s first-quarter statement. “Since mid-March, our Marketplace platforms have experienced strength in key metrics – traffic, buyer acquisition, conversion, sold items and GMV [gross merchandise value] – due to ongoing shelter-in-place dynamics in many countries. The marketplace platforms have also experienced improved acquisition of small business sellers. This strength has continued into April.”

But, it said it was unclear how things would change in the future. “The impacts seen in both platforms to date could continue while shelter-in-place guidelines remain active, and it is difficult to predict what may result as shelter-in-place guidelines are eased and lifted and how global consumer demand and seller inventory may evolve over time,” said eBay.

In the US, eBay is helping high street retailers speed up the way they sell via its marketplace during the Covid-19 pandemic. A new ‘up and running’ programme aims to help high street retailers open online shops  as quickly as possible.  

In the UK, the marketplace has been involved in building a marketplace PPE platform for the UK government to distribute protective equipment to health and care workers. 

eBay says it has also given support worth more than $100m to its staff, communities and customers. Many sellers have received an offer of deferring eBay fees in order to support their cash flow. eBay store subscribers have also had up to 100,000 free listings. 

The update came as eBay this week reported its first quarter figures, for the three months to March 31. It reported net revenues – sales – of $2.4bn, down 2% on the same time last year. Net income of $586m was 1% down on last time. Looking ahead, the marketplace expects sales to grow by between 2% and 6% on last year during the second quarter. eBay has also bolstered its by selling StubHub to viagogo for $4.1bn. 

Scott Schenkel, who has been acting as eBay’s interim chief executive, said: “During these unprecedented times, I am extremely proud of how our team has come together to support one another, our buyers and sellers, our communities and the business. As we look at Q1 I am pleased  that we delivered on all of our commitments for the quarter, with key metrics such as buyers, GMV and revenue performing at or better than our expectations. Over the past several months, we have remained focused and clear-eyed about the strategic direction of the company and have driven substantial changes to position the business for sustainable and profitable long-term growth.”

Incoming chief executive Jamie Iannone said: “I appreciate the team’s hard work in the first quarter and their efforts to maintain focus amid so many factors affecting the business and the industry. I’m thrilled to return to eBay this week as chief executive and I look forward to building on the positive momentum in the business, continuing to evolve the company’s strategy and maximising value for our shareholders.”

eBay said that most of its staff around the world were working from home, although they were now starting to return to offices in China, Taiwan and Korea. 

Image courtesy of eBay UK

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