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EBay gives sellers storefront off eBayPlus: eBay loses key technologist
By Bambi Francisco, MarketWatchLast Update: 11:06 AM ET Jun 23, 2005
SAN FRANCISCO (MarketWatch) -- If you can't beat them, join them. EBay, whose sellers are increasingly considering alternative platforms to sell their wares, says it'll now help its sellers set up shop off eBay.
The storefronts, called ProStores, were unveiled on the same day eBay kicked off its annual community conference, expected to draw about 10,000 people
"Our sellers are multi-channel in their DNA," said Michael Dearing, eBay senior vice president and general merchandising manager. "This has always been true [since the start of eBay]. The launch of ProStores is a continuation of that strategy."
About 30% to 40% of eBay's 158,000 storeowners are expected to have their own stores off of eBay, according to Dearing.
EBay (EBAY) sank 1% to $35.84 in trading early Thursday. Investors are concerned over the departure of a key technologist at eBay. The company said that Louis Monier, known for creating search engine Alta Vista, left last week. Speculation is that Monier is going to run Google's (GOOG) Froogle. Officials with Google weren't immediately available to comment.
Separately, shares of Google fell a quarter of a percentage point to $288.44 Thursday morning. Late Wednesday Standards & Poor's announced that D.R. Horton Inc. would be added into the S&P 500, replacing Veritas (VRTS). Google is widely expected to be added to the index at some point, which would require mutual and index funds seeking to match the index's performance to own the shares.
EBay's ProStores service, which is available today, has four-tiered pricing. The entry level price "Express product" starts at $6.95 per month, with fees ranging from 0.5% to 1.15% per transaction. The top-tier pricing costs $249 per month, plus 0.5% per successful transaction.
Dearing said that ProStores will be targeted to eBay's PowerSellers, those customers that sell $1,000 a month or more in gross merchandise value. EBay doesn't disclose how many PowerSellers it has, but the company said it has 158,000 storeowners.
Asked what percent of the storeowners eBay expects to sign up for ProStores by the end of the year, Dearing said that eBay has "preliminary targets," but won't disclose them.
It's also too early to say whether ProStores' sellers will get any preferred listing on search engine Shopping.com (SHOP), which eBay is in the process of buying. That deal is expected to close by the third quarter.
Asked if eBay expected to see its budget for keyword marketing rise as more sellers build their own Web presence off eBay, Dearing said that ProStores' sellers will be responsible for their own campaigns to drive traffic to their stores. "The important thing to know is that it's bring-your-own traffic," he said. "Our large sellers are developing the skills to market their merchandise... There will be an ability to track and manage their own marketing investments," as part of ProStores, he said.