It appeared as though eBay was all set to go head-to-head with Amazon with fixed price offers selling new items directly to consumers rather than following the auction model that made the company an e-tailing giant. Now, it appears as though one holiday season along, eBay has decided that maybe it doesn't have what it takes to be the next Amazon and instead it is focusing its efforts on becoming an online source for consumers to buy used items, discontinued products and overstocks. John Donahoe, chief executive at eBay, puts the global value for these products at roughly $500 billion a year, according to a Wall Street Journal report.
"We are aggressively remaking and transforming our eBay Marketplace and diversifying the ways in which we compete in ecommerce," Mr. Donahoe said in a company press release. "We operate in what is still a young and rapidly evolving ecommerce landscape, and as the pace of change in ecommerce accelerates, we are not here to mimic or follow. We are here to lead and innovate. We are positioning this company to compete and win across a range of profitable ecommerce platforms focused on connecting buyers and sellers across the platform of their choice."
According to the same report, eBay's traffic fell 16 percent in the fourth quarter last year.
Mr. Donahoe, told the Journal, "We aren't a retailer. We're going to focus where we can win."
Discussion Question: What do you think of eBay's latest change in strategy?