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November 30, 2009

eBay's change in Holiday promotional strategy between 2008/2009 - will it work?

I was reviewing last year's Black Friday and CyberMonday results and trends and noticed some interesting differences in eBay's strategy between 2008 and 2009.

2008 - A Cornucopia of Online Promotions...

Last year, eBay's Holiday promotional mix was best described as heavy online promotion. They partnered with Microsoft to offer up to 30% off on Bing (Live back then) cashback.  On top of that eBay flooded the marketplace with a ton of coupons (10% off $100, free ship, etc.)

2009 - Back to TV (Come to think of it....)

This year Bing bumped up from 8 to 10% cash back for CyberMonday which may seem decent, but compared to last year is paltry.  Last year, eBay was one of the only merchants in Bing Cashback, this year the program is very robust with hundreds of merchants and many of them offering 15% or more, so eBay actually feels under funded in that environment.

Cybermonday_ebay_cashback_10pcnt
 

eBay doesn't seem to be running any major coupons that I've seen either.

However, while eBay has pulled back from cashback and coupons, they are running TV spots and interactive media like nobody's business.

One idea of why they would change strategies is maybe they evaluated the Q408 strategy and found it to be more cannibalistic (giving discounts to folks already going to buy on eBay) vs. incremental (new buyers).

eBay is a no-show for CyberMonday :(

I did a comprehensive survey this morning (CyberMonday morning) and pretty much every online retailer ran some great CyberMonday promos: Walmart.com, Amazon,com, target.com, toysrus.com, buy.com  - you name it, they were running strong CyberMonday promotions, highlighting great gifts, etc. Here's what eBay was running this morning: (click to enlarge)

Ebay_cybermonday
 

You can look at this page with a microscope and you won't find the words Cyber or Monday and certainly not CyberMonday anywhere.  eBay is really missing the boat IMO by not joining with the rest of the online retail world and doing something special on this day.

Conclusion

We're watching the data closely from BF and CM to see what early holiday shopping trends we are seeing - eBay Strategies readers, what are you seeing?  Do you think eBay's focus on TV vs. Online promos is the right strategy this year?

SeekingAlpha disclosure - I am long Google and Amazon, eBay is an investor in ChannelAdvisor where I am CEO.


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