And mobile revenue increases year over year on Black Friday, as more shoppers turn to their smartphones, a new study finds.
eBay conquers mobile commerce with a drive to release an app for every occasion.
Apple Inc.'s signature line, "There's an app for that," neatly sums up eBay Inc.'s mobile commerce strategy. Want to buy on eBay? There's an app for that. Want to sell? There's an app for that. Want to buy fashion and only fashion? There's an app for that. Want to scan bar codes? There's an app for that. Want to shop in German? Yes, there's an app for that.
The Internet giant has an m-commerce site, too, which it launched in spring 2007. 30% of its projected $1.5 billion in mobile commerce sales this year will come through the site, the company says. But it believes the other 70% through apps—the first of which it launched in summer 2008—is key, especially as a rapidly growing number of consumers adopt smartphones that run apps.
"Look at any smartphone home screen and you see apps with narrow functions. You have a calculator, the weather, and that's all they do," says Steve Yankovich, vice president of platform business solutions and mobile at eBay. "On eBay, we have a large number of users who stay in categories. They spend hours on the parts and accessories in automobiles. They don't care about jewelry or jeans or LCD TVs, they want their entire experience to be focused on the category they are enthused about."
With that in mind, eBay is doubling down on apps, planning to come out with ever more specific apps on a regular basis, every five weeks for awhile. And it plans to enhance those apps with complementary technology, from bar code scanning that lets store shoppers comparison shop on their phones to augmented reality apps that let shoppers visualize themselves in articles of clothing.
The app strategy is at the center of eBay's strong commitment to mobile commerce. It won't say how much it has invested to date, but after $600 million in sales in 2009, Yankovich says the company is "very happy" with the return on investment. And like sales, traffic has been robust: eBay's m-commerce site and mobile apps received 6.4 million unique monthly visitors in June, according to The Nielsen Co., tops among m-commerce players.
"Like with any new technology, being early is helpful, and eBay has been really aggressive," says Scot Wingo, president and CEO of ChannelAdvisor Corp., an e-commerce and m-commerce technology and services provider that also helps retailers sell on marketplaces like eBay. "There are some things about eBay that really appeal to mobile. Like the selection of eBay, which is so broad that it gives eBay a wide audience. And for auctions it is pretty convenient; you don't want to be sitting by your computer at 8 p.m. on a Saturday night waiting for an auction to close."
Wingo is not ready to take a stand on eBay's strategy of developing very specific apps, rather than putting a lot of functionality into one piece of software that mobile consumers can use. "It will be interesting to see which strategy wins out," he says. "It's too early to call."
But eBay has made its call, and that is to make a big push on apps for specific purposes. And e-Bay is app-happy for a variety of reasons beyond the fact that a great many of its shoppers like to shop one primary product category.
"Imagine if you had all these rich experiences buried into one hub," Yankovich explains. "Then you have a lot of navigation. If the 10 magazines you like best were all bound together in one issue, the weight and physical complexity of that giant magazine would be like the experience you would have if everything you did was in one app."
What's more, apps provide eBay a platform for testing new ideas.
"We have the Deals app, which does not have a huge audience, but it gives us a way to test a new model of engagement without subjecting our entire user base to it," Yankovich says. "We can do a smaller audience, collect feedback and fine-tune, and move it into a bigger property if we want to. If I had one mega-app, I'd have to line up all the things we'd like to do in one, single schedule. Mobile is a fast place to be and we have to try things at a rapid clip."
There are times, though, when it makes sense to pull together differing features and functions into one app, enhancing the mobile experience and making an app more useful for a greater number of people, he adds.
"The Selling app has been hugely popular. We are at 11 million downloads of the core app, and in a coming release we will unify Selling into that app," he says. The core app is the broad eBay Mobile offering; the Selling app is geared exclusively to consumers listing items for sale. "A lot of what happens during the selling flow is similar to the buying flow; the job is to figure a way to bring the two together in one app that is not too jarring."
Yankovich explains that someone who is buying a product wants to research the product, see the current price and conclude what it might ultimately sell for. The same goes for a seller, he says, who wants to research other listings of the product or similar products, see current prices and gauge where prices may peak. Since both processes are so similar, combining the two in one app will not be jarring, he says.
EBay is also out to conquer foreign markets, and it believes mobile apps dedicated to countries can help it gain sales. It already has apps for Australia, Canada, Germany, Hong Kong, the Netherlands, New Zealand, Poland, Singapore and South Africa.
And the way mobile commerce is evolving, Yankovich can't always say for sure what's next.
"Next week it might be another country, or maybe something content-related, or a new device," he adds. "The moment I got a call from Apple saying the iPad was real, I shifted my schedule and put people on the iPad app. We're still in early days and you have to be nimble."