eBay is missing the boat
I just finished reading about the recent partnership between eBay and Yahoo! and couldn’t help but think that eBay is missing out on an opportunity to compete with both Yahoo! and Google.
Although reservations exist, the partnership is going to bring targeted Yahoo! advertising to eBay.
“Small text ads that automatically appear next to related material on Web pages have proved hugely profitable, but eBay has long been wary of placing them on its site because they are likely to refer people to sites that compete with its marketplace.”
What are these small text ads? They’re from companies who have something to sell. I can think of another large population who has something to sell which eBay has direct access. Yup, people on their site.
Why not build an ad network to compete with Yahoo! and Google and take advantage of their greatest asset; the dedicated user base. eBay could start out simply by serving the Auction Ads (Trademark pending) to their own site. When a user adds something to sell, eBay gives them the option to bid on keywords for text advertisements to help promote their product in other spots on the site. Once eBay works out the kinks locally, they can expand to a Google type ad network and allow the millions of web loggers and top quality content producers to place eBay ad listings on their sites.
It probably isn’t consistent with the eBay business plan to become a provider of advertising, but I doubt the initial business plan had eBay being a payment gateway or a phone company either. As the CEO Marge Whittman said, “we have to embrace some of the things that are happening on the Web.”
