eBay 4Q results are in .... sales increase a scrawny 1%

[orangehound]

This afternoon, eBay  released its 4Q results.  Highlights:

• The GMV of sales on the marketplace were up 23.23 billion from 22.99 billion (1%) ... GMV is the gross total of all transactions before subtracting off things like returns, non-paying bidders, etc.
• Customers on the marketplace platform increased 4% (170 to 179 million)
• Revenue from the marketplace increased 8% ... driven primarily by advertising (Promoted Listings and those annoying ads on every listing that take customers off site).
• The forecast for 2019 is basically stagnant growth ... something like 0-2%.

What does this mean?  eBay's growth continues to lag badly behind other internet sites that are growing at double-digit percentages ... eBay is losing market share.  It is evidence that eBay is led with incompetence, for no on-line retailer should expect stagnant growth in such a rapidly expanding marketplace.

In my opinion, they are still not addressing key factors to growth:

• F-minus Customer Service.  eBay has the worst customer service of all on-line retailers, and it is not even close.  Many times, customer service agents cannot even properly understand English.  eBay MUST improve customer service at its headquarters and through standards with the individual sellers.
• Theft and Scams.  eBay has a reputation as being a platform where dishonesty, theft, and scams are widespread ... though eBay has enacted policies to protect buyers, they have failed to protect sellers who, understandably, turn to social media to further erode the poor reputation of this site.  The protection must be balanced.  This reputation creates buyer hesitation, and overall reduces sales velocity.
• Non-competitive Shipping.  eBay has gone to great lengths to provide inexpensive postage for sellers from China and Hong Kong (the ePacket), but has done virtually nothing to set up discounts that benefit US Domestic sellers.  The postage buying power of eBay needs to be leveraged, somehow, and passed over to sellers ... if not the USPS, then FedEx or UPS.   If nothing is done, Amazon, Walmart, Target and others will steamroll this site  as sellers are overburdened with increasingly smaller margins.

[ekmadonna]

Orangehound you just called out the cheerleaders!

[orangehound]

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@ekmadonna wrote:

Orangehound you just called out the cheerleaders!

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I'm generally a cheerleader ... but those numbers are inexcusable.  eBay's quest for increased profit by going cheap on customer service, milking sellers, and having a narrow vision of the future is gutting the platform.

That is not to say that eBay is failing everywhere.  Improving the interface, creating the buy box, structured data, streamlining returns, etc. are all good initiatives.

[ekmadonna]

I have to disagree with you on the BUY BOX, That Feature is a race to the bottom in pricing, I am glad I don't have to worry about that though because 99% of the things I sell are not new big box mass produced items. Fixing the horrid search is huge, and some relief with the ever increasing shipping prices would be a big help. shipping prices are out of control.

[coolections]

Of course smaller platforms will increase higher. Nothing new at all. Ebay is in line with most all SP 500 companies.

[mvls1]

I would think that Ebay and their shareholders cannot be happy with those results.

[gracieallen01]

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@mvls1 wrote:

I would think that Ebay and their shareholders cannot be happy with those results.

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Oh, I have a feeling that Elliott is going to be happy.  Come the end of March, it seems that Elliott will make a lot with the $0.14 dividend, just from their letter.  And, the fun hasn't even begun, yet.

[dhbookds]

Well, they announced a 14c dividend and plans to return 7 (?) billion to shareholders in the next 2 years, so that might make them somewhat happy.......  If ebay turns into

an steady income producing stock, instead of waiting for the magic "jump" into higher stock prices, it could be an answer.............

[gramophone-georg]

coolections wrote:

Of course smaller platforms will increase higher. Nothing new at all. Ebay is in line with most all SP 500 companies.

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We'll see what Amazon says on Thursday... would you say they are a "smaller platform"?

[vintagecraze50]

Yes, let's hope he is Really happy with that and does NOT want to be happier. At least for a bit so that the company can move massively forward with the payment system in place and all the goodies that are planned to increase velocity. I believe they can do it.  NO QUESTION ABOUT IT.

[cnmvintage]

AND the USPS and their price gauge just cost 4.57 ro send off a LIGHT Hot Wheels card in a LIGHT box- Paypal charges 45 cents- eBay 35 cents- what am I supposed to make on paying 50 cents a car with bubble wrap and peanuts/tape??

[orangehound]

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@coolections wrote:

Of course smaller platforms will increase higher. Nothing new at all. Ebay is in line with most all SP 500 companies.

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Ummm ... I'm not comparing eBay with SP 500 ... but with e-commerce.  Looking at the top e-commerce companies in 3Q 2018

• Amazon  - Sales up 36% in North America, and 14% internationally
• JingDong - Sales up 25%
• Alibaba - Sales up 56%
• eBay - Sales up 6%
• Rakuten - Sales up 17%

Do you see the odd-ball in that group?  I haven't seen 4Q performance for the others, but I suspect that they will be dusting eBay's embarrassing 1% growth.

[vintagecraze50]

I disagree with bad customer service. I just got off the phone with H&R block. I got a non primary english speaking rep that gave me a lot of bad information and I had to call back again. I have been on the phone with numerous BIG industry companies with far worse customer service than here. NEVER, have I had someone at Ebay waste my time, keep me on hold for three hours, not been able to understand exactly what I was talking about, and all my calls here have been resolved promptly and effectively.

[gracieallen01]

I wonder who is going to be the loser - or just the sellers?

They are going to still be trying to buy back stock, still have to meet the monthly payroll, and, of course, the upper level(s) who are compensated with stock get a raise, and such.  Do the numbers don't look all that good for starting to give a dividend, just out of the blue?  I'm sure it is just coincidence that the dividend is announced just after the Elliott letter - and, if not, it could be an indication that Elliott has a lot more pull than given credit.

Nah, nothing like that here.

[vintagecraze50]

Regarding theft and scams--that is widespread all over the internet. It is the nature of the beast. Now, thinking up better ways to prevent scams is something they could do some work on. Better protection of sellers through a creative way of doing refunds returns, say store credit option for returns, maybe too many returns you are on suspensions or whatever.