eBay is practically treated like a middle child in the retail family, attracting much less attention than Amazon or Walmart.
But according to eMarketer estimates, eBay ranks second in US retail ecommerce sales, generating $30.66 billion in 2017—nearly double the amount created by Walmart and Apple.
eBay had strong third and fourth quarters in 2017, which isn't fully reflected in the September 2017 eMarketer figure. In Q4, global sales grew 9.4% to $24.4 billion. And for the full year 2017, eBay reported revenues of $9.6 billion, a 7% increase from 2016.
What's driving sales and what's in store for 2018? Let's take a look.
Product Mix: Mostly New and Full-Price
Though some still think of the online retailer as a virtual yard sale, eBay now gets most of its sales from third-party sellers rather than individuals offloading used paperbacks. According to the company, the majority of items sold on eBay are new (81%) and only 12% are sold through auction-style bidding.
Demographics: Young and Male
The bulk of eBay shoppers are 18 to 34 (47.2%) and skew male (66.7%), according to Internet Retailer. Shoppers ages 35 to 44 make up 20.5% of the total, and interestingly, shoppers 55 and older are represented slightly more than those 45 to 54 (17.2% vs. 15%).
Growth Area: International Expansion
Well over half (57%) of eBay's revenues are international, and eBay or eBay-owned platforms are the leading ecommerce sites in many countries (Australia, South Korea and the Netherlands) and rank higher than Amazon in countries like Argentina and Finland. According to an October 2017 survey of cross-border digital buyers worldwide by International Post Corporation, 18% of respondents used eBay for their last purchase, which goes to explain two recent moves by the marketplace.
Last week, eBay bought Giosis' Japan business, including the Qoo10.jp platform, to expand its presence in Asia-Pacific. In a statement, Devin Wenig, president and CEO of eBay Inc., explained the goal with new shoppers in Japan would be to "broaden our presence in a dynamic, underpenetrated market with strong ecommerce potential and high mobile adoption."
Earlier in February, eBay partnered with delivery and payments provider PideloRapido to start giving buyers in select countries in Latin America means to purchase on eBay even if they don't have a US address and want to use local currency.
The Future: Better Shopping Through Tech
In 2018, eBay is going hard on artificial intelligence (AI) and augmented reality (AR). Last month, it hired former Twitter data scientist Jan Pedersen as vice president and chief scientist of AI. In eBay's Q4 2017 earnings call, Wenig outlined goals for the coming year. "Our technology innovation continues to focus on emerging platforms such as artificial intelligence, voice and image technology, virtual and augmented reality and distributed commerce," he said.
Bloomberg reported that some of the AR tools would be geared toward helping users buy car parts and sellers to figure out optimal box sizes for shipments. eBay has already implemented visual search on its app, an eBay ShopBot on Facebook Messenger to aid in finding deals, and "Ask eBay," a conversational commerce option on Google Home.
eBay is also attempting to use AI for better personalization and to increase product discovery in hopes of expanding its user base beyond strategic shoppers—also Amazon's core—who know exactly what they want and search rather than browse.