EBay’s Foresight into the Mobile Commerce Market Pays Off

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Rapid penetration of the mobile market is playing an increasingly critical role in an e-commerce company’s success, as more consumers shift to online shopping and to shopping using their mobile devices.

While many companies struggle to bridge the gap, revenue for eBay, the world’s largest e-commerce marketplace, jumped 15 percent for the quarter, to $3.4 billion. That included a nine percent increase for its biggest business, Marketplace, to $1.8 billion, and a 23 percent increase for PayPal, to $1.37 billion.

Chief Executive Officer John J. Donahoe attributed the company’s success, in part, to an early bet he had that mobile phones would become a platform for commerce, as reported by The New York Times on Thursday.

“People love shopping on their smartphones and iPads, and PayPal is still the safest way to pay on a mobile phone,” he said, adding that the company has been investing in mobile technology, marketing campaigns and website redesign.

Those investments have been paying off.

Last quarter some 800,000 new users made their first eBay purchase from a smartphone, eBay’s mobile apps have been downloaded more than 100 million times worldwide, and eBay sellers are now posting two million items a week from their smartphones, the company reported.

One of the most recent innovations it is experimenting with is eBay Now, a new mobile app that allows consumers to shop from Macy’s, Target and Walgreens, with their smartphones and have their purchases delivered the same day, The New York Times reported.

Donahoe took over in 2008, when eBay’s stock hit a low of $10 per share and has managed to bolster it back up to $50.83 a share, a 68 percent increase this year. The company expects each of its businesses to hit $10 billion in sales volume by the end of 2012, The Times reported.

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