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Mobile Commerce Means Huge Jump for eBay Revenue

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January 17, 2013

Mobile Commerce Means Huge Jump for eBay Revenue

By Steve Anderson
Contributing TMCnet Writer

With a soft economy still prevailing over much of the world, any time the phrase "strong growth in revenues" comes into play, it's the kind of thing that makes people take notice. Who managed to pull off such a feat this time? This time around, eBay (News - Alert) was the one who recorded the big jump in revenue. Though the time of year had something to do with it, there was a larger development spurring eBay's impressive revenue gains: mobile shopping.

eBay's fourth quarter revenue weighed in at a hefty $4 billion even, according to reports, which was up 18 percent over the fourth quarter results of 2011. Over the course of the whole year, eBay's revenue saw a spectacular jump to $14.1 billion, up fully 21 percent over the previous year. Driving these boosts in revenue gain was, clearly, a jump in the use of mobile commerce over the same period, as more than four million new customers signed up in 2012 to use eBay's various mobile apps.

This isn't a particularly new development for eBay, however, as the company has experienced fully 14 consecutive quarters of sales growth under the guidance of CEO John Donahoe, who led a major turnaround effort for eBay starting in March 2008. This led to impressive milestones as well; eBay's last Cyber Monday (News - Alert) was a huge success, as transactions made on eBay mobile apps fully doubled over the previous year, and payment volume nearly tripled.

eBay even has some optimistic outlook for the future as well, with expectations of clearing $20 billion in 2013 on mobile shopping. During a conference call with investors, CEO Donahoe referred to mobile as "...quickly becoming the new normal...", and saying that eBay was "...leading this new way consumers shop and pay".

Major growth for eBay was likely attributable to several factors beyond the mobile strategy. Continuing weakness in the economy ensures a healthy market for used goods of all stripes as some look to divest and get a little more liquidity under them, and those with a healthier liquidity look to pick up some new items at a good price. Additionally, a weak job market has entrepreneurs looking to eBay as a potential revenue stream, making both new and used goods available on the service. But there's no denying that mobile shopping was a huge force for eBay, as it was for many businesses, even those unrelated to third-party sales.

The lessons learned from eBay's big bliss spa promotion back on Black Friday (News - Alert) were likely not lost on many retailers, and it wouldn't be surprising to see it come around again, with many more spas offering up mobile Internet access to allow shoppers to hunt down their biggest bargains of the year while enjoying a relaxing treatment of some kind.

Mobile shopping is an increasingly large part of the mobile landscape, make no mistake there, but just how it will be used in the coming months will truly bear watching.

Edited by Brooke Neuman

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