Oct. 12 (Bloomberg) — EBay Inc. Chief Executive Officer John Donahoe talks about his company’s X.commerce platform, an arm of the business aimed at developers and merchants.
Donahoe talks with Cris Valerio on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)
EBay Inc. (EBAY), the world’s largest
Internet marketplace, unveiled tools designed to increase the
use of its commerce and payment services on Facebook Inc., the
biggest social network.
The move will make it easier for developers to share their
work and give them a say in the evolution of so-called social
commerce on Facebook, said Matthew Mengerink, general manager of
X.commerce, EBay’s developer and merchant business. Programmers
can use X.commerce to create applications for buying, selling
and sharing preferences on Facebook’s site, Mengerink said.
EBay Chief Executive Officer John Donahoe is expanding the
company’s reach beyond merchants and sellers to developers, an
effort to increase use of its payment programs on other Internet
sites and stores. EBay’s new platform lets any developer create
products and connect with retailers, without requiring them to
use EBay, Donahoe said today at EBay’s Innovate developer
conference in San Francisco.
“We’re building up small, mid-tier and large merchants to
accelerate growth,” Mengerink said in an interview. “If we
have millions of merchants on this globally, we can distribute
the best integration of your merchandise and connect into the
EBay storefront. The exact same thing is true with PayPal.”
Developers for both the company’s GSI and Magento platforms
will work on creating social commerce functions, such as
clickable tabs for e-commerce that mirror Facebook’s “like”
button, and decide where in the purchasing process they belong,
Mengerink said.
Offline Products
While EBay’s inroads into Facebook’s commerce efforts may
help attract more merchants and developers, the announcement may
have disappointed investors who were looking for a “higher-
profile” connection with Facebook, said Doug Anmuth, an analyst
at JPMorgan Chase Co. (JPM) in New York. That relationship probably
won’t happen in the near term, he said in a note today.
PayPal is also rolling out products that move the service
offline into local retailers, said Sara Gorman, a PayPal
spokeswoman. Those products will let consumers pay through a
mobile phone application, by swiping a card or by entering a
name and PIN number at the point of sale in a store. The company
will test the products with a “major” retailer by the end of
this year and introduce them more extensively in 2012, she said.
Growth Through Acquisitions
Donahoe said in an interview with Bloomberg Television that
the company also intends to grow through takeovers. EBay’s
announcements today integrate two acquisitions — Magento,
acquired in June, and last year’s purchase of RedLaser, an
application that lets mobile users scan bar codes.
“We will selectively make acquisitions where it can help
enhance our position,” he said at the conference. “That is,
really building out the kind of commerce tools that we want for
the future.”
There’s no chance the company would spin off PayPal, the
company’s payment service, Donahoe said.
EBay shares fell 8 cents, or 0.2 percent, to $32.75 in New
York today. The stock has gained 18 percent this year.
Facebook Chief Executive Officer Mark Zuckerberg unveiled
new ways for members to use the social network to share music,
movies, TV shows, news and activities such as cooking and
exercising at its F8 developers conference in San Francisco last
month. The features will include partners such as Spotify Inc.,
Hulu LLC and Rdio Inc., and will let users see a history of
songs played and listen together, he said.
Social Commerce
EBay, based in San Jose, California, is betting a
relationship with Facebook, which has more than 800 million
users, will jump-start developer adoption of X.commerce. EBay’s
partnership will be the next step in making commerce more social
on Facebook, Mengerink said.
“We’re not saying ‘merchants, work with EBay
developers,’” he said. “We’re saying, ‘let us connect you.’”
EBay announced an application store for the Magento
platform today called Magento Connect, letting programmers
create and sell software.
The company also will update its RedLaser application. The
newest version will let consumers pay for products they scan
with their phones, allowing EBay to take part in more of the
consumer’s thought process before and during a sale.
To contact the reporter on this story:
Danielle Kucera in San Francisco at
dkucera6@bloomberg.net
To contact the editor responsible for this story:
Tom Giles at
tgiles5@bloomberg.net
