EBay is ramping up its sales efforts to take aim at Amazon's giant advertising business

Scott Kelliher of eBay

  • EBay is taking aim at Amazon’s giant and growing ad
    business.
  • The company is bringing its ad business in-house, has hired
    specialists, and has brought on a seasoned sales exec from Time and
    Yahoo.
  • EBay’s pitch is that it’s easier to work with and more generous
    with data than Amazon is.
  • But it has low awareness and a downmarket image with some
    advertisers.
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    more BI Prime stories
    .

Amazon is becoming an
advertising behemoth
— and eBay is coming for its share.

EBay started taking its ad business more seriously in 2017, when
it stopped outsourcing its ad sales function to make a bigger push
for what it considers complementary advertisers like financial
services, auto, and telecom — those that don’t sell products on
the site. So eBay can, say, find visitors who were in the market
for a car and help an insurance company target them for auto
coverage.

Read more:
EBay exec reveals a key advantage for sellers choosing the site
over rivals like Amazon

EBay has since grown its own sales team and assigned people to
specific categories. It’s created an account management team and a
client strategy and insights team to better cater to big
advertisers. Finally, it hired Scott Kelliher, a vet of publishers
like Time and Yahoo, as its first head of brand advertising and
partnerships, in May.

Amazon may be a giant in e-commerce and increasingly,
advertising, but it has its weak points. It’s been steadily
building up its own lines of products like household goods,
directly competing with the advertisers and sellers that use its
platform. It’s those points that eBay is trying to leverage.

EBay is trying to exploit Amazon’s weaknesses

Ebay’s pitch is that it’s big and has tons of data on what kinds
of products people buy and their path to purchase — without the
conflict of interest or data-sharing problem that many advertisers
frequently criticize Amazon for.

Another frequent advertiser complaint is that the Amazon’s ad
business is sprawling and fragmented, making it hard to run a big,
coordinated ad campaign on the platform. EBay, meanwhile, is more
than willing to bring all the parts of its ad offering together for
advertisers.

“There are very few places that are as big as we are,” Kelliher
told Business Insider. “Our data and place we sit in the e-commerce
advertising system is unique. We’re the only one that doesn’t own
any inventory.” While other sites are “unwilling” to give
advertisers the data they want, he said, “We’re happy to
share.”

Chris Merrill, SVP & CMO of direct to consumer at Synchrony,
an internet savings bank, said the bank started testing advertising
on eBay in 2018 and has increased its use of eBay since to grow
awareness of the bank and drive people to its website because eBay
can help Synchrony reach people it can’t reach elsewhere.

“They have a lot of data and they know how to use the data,” he
said.

Other retailers are getting into advertising, too

To be sure, eBay has an opportunity, but it faces challenges,
too. EBay has 6.6% of US e-commerce, though that’s dwarfed by
Amazon, which has about half the market. EBay is on track to do
$700 million in advertising this year, a sliver of Amazon’s $11
billion-plus projected ad business.

Advertisers are spending more with online retailers as they
divert shopper budgets from physical retail stores and traditional
media companies to places where they know people are already in a
shopping mindset and the retailers have rich data on them.

But that also means eBay has to contend with grocery giants like
Kroger, Walmart, and Target that are getting into advertising as
their retail businesses struggle to compete with Amazon.

EBay has to do more to let advertisers know it’s open for
business and also convince them it’s a good place for
brand-building, not just driving a sale. It doesn’t have video ad
formats, which advertisers have come to expect. Plus, its overseas
reach is limited compared to Amazon. 

Kelliher said eBay does have global ad sellers, but acknowledged
eBay has work to do.

“It’s a lot of awareness — what we’re capable of, making
advertisers understand what’s unique about us,” he said.

EBay has a ‘bargain-basement’ problem

But eBay’s problem goes beyond awareness. Mudi Jaju, global head
of ecommerce at the agency Wavemaker, gave eBay credit for being
easier to work with than Amazon and for being proactive about
offering up data to advertisers.

But he also pointed out that eBay’s discount image and presence
of counterfeits sold on the site hurts it with certain advertisers.
(EBay’s heard this before; its response is that 80% of items sold
on eBay are new and 90% of items are sold at a fixed price, not
auction.)

“If you’re a fashion brand, eBay does have a bargain-basement
twinge,” Jaju said. “That holds up a lot of brand spend. The other
issue is, if you’re at the brand outlet section, of the six links I
looked at, half of them were broken. I’m rooting for eBay because I
desperately want someone to challenge Amazon. I put multiple
proposals to clients, but there’s a perception problem. At Amazon,
it’s operationalized. It’s archaic and slightly bonkers, but it
works.”

SEE ALSO: AT&T
just signed deals to sell ads for Bloomberg and Walmart-owned Vudu,
and it’s the latest sign of the telecom’s big ambition to pitch
external publishers


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Source: FS – All Tech News
EBay is ramping up its sales efforts to take aim at Amazon's giant advertising business