eBay CEO Jamie Iannone Discusses Latest Recommerce Report

Liz Morton ~ Founder
Liz Morton ~ Founder


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A new study from eBay says Gen Z is driving demand for recommerce, but that's not exactly news - it's been part of eBay's PR pitch for over a year now.

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CEO Jamie Iannone stopped by BloombergTV to discuss the most recent recommerce report.


Inflation

When asked about how inflation may effect sales on eBay, Jamie painted an optimistic picture saying it's a great place to turn to sell your pre-loved items. However, it would be a mistake to believe that inflation doesn't affect eBay or isn't a concern.

Not only is inflation rising, so are many costs of doing business on eBay that must end up being passed on to buyers. For example, eBay just increased final value fees for most categories last month.

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Carrier shipping rate increases and surcharges for large packages may price many items out of the market (for example, pre-loved golf clubs or fishing rods may now be so expensive to ship, you'd be better off buying new at B&M)

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And as eBay continues expanding their plans to generate more revenue via seller paid advertising opportunities, those ever increasing ad rates inevitably end up added into the prices buyers pay as well

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Certified Refurbished

At least Jamie has finally gotten the terms of certified refurbished down pat, avoiding another embarrassing gaffe like when he told CNBC in December these items come with a 2 year money back guarantee (as opposed to a 2 year warranty).

However, warranties and guarantees are only as good as the company backing them up and unfortunately I've seen troubling reports that indicate the certified refurbished program may not be living up to its promises.

Jamie touted 30 day returns, but didn't mention that eBay is more than happy to bend those rules for promotions with preferred partners like Samsung.

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And some buyers are finding they are in fact not in great hands when it comes to that 2 year warranty provided by eBay in partnership with All State/Square Trade.

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Non-new in season, enthusiast buyers & accidental entrepreneurs

When asked about non-new in season, Jamie was optimistic about the total addressable market opportunity.

If you look at any category on ebay - sneakers, handbags, collectibles, trading cards, sports equipment - we're only high single digit or low double digit penetrated so there is a lot of opportunity and a huge TAM for us to go after.

It's interesting he didn't mention Motors Parts & Accessories, the latest addition to the vertical focus playbook, but did mention sports equipment - is that a possible hint at the next category for the vertical treatment?

Asked about Q4 2021's plummeting buyer numbers, Jamie leaned in on the enthusiast buyer strategy, saying these high value buyers make for a healthier marketplaces. Again, we've been hearing that for over a year now and both sellers and Wall Street seem to be getting impatient waiting for the proof in the pudding.

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Jamie also crowed about how eBay helps "accidental entrepreneurs" - people who start selling on eBay because they need money in a pinch and end up building a business on the platform.

Of course what he didn't mention is those new sellers in a pinch will be in a very tough place once they find out eBay holds their funds for up to 21 days.


Digital Wallet & Cryptocurrency

Asked about digital wallet and cryptocurrency, Jamie deferred on crypto and instead focused on Klarna and Afterpay but failed to mention those are only available in Australia and German markets.

He also mentioned "spendable funds" which is rolling out to select sellers now, allowing sellers to use sales proceeds to purchase items on the platform.

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However, he wasn't getting let off the hook so easily ,especially after previous comments about "exploring crypto" caused a flurry of media and investor reaction prior to the Q4 earnings call.

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Pressed again on the issue of cryptocurrency, he again avoided the subject, saying "we're really just focused on what are the best types of payments that we need. We continue to expand them on the platform and go from there."

So there you have it crypto enthusiasts...don't hold your breath for a cryptocurrency option on eBay any time soon.


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