posted on September 1, 2001 09:34:58 AM
I am a little concerned about the future of eBay because of the rosy predictions they are making for continued growth.
I just don't see the growth they are projecting unless the foreign governments loosen up a great deal on internet access and telephone costs.
What I am specifically worried about is that if they suffer a stock crash due to not meeting investor expectations is there a danger the service as we know it may be shut down? I would hate to see that but don't know if it could happen - or if they will just plug along at a lower level than they would like.
posted on September 1, 2001 10:23:24 AM
lets see, right now they are making money hand over fist, they set goals to be making 2 hands and a foot over fist, say they only reach 40% of that goal...why in the world would they shut down when they are still making tons of money???? just because their lofty goals are not met does not mean the doors will close. the doors will close when money is no longer being made
posted on September 1, 2001 10:29:56 AM
What happens is like anyother company they low there projection.
look at many larger companies then Ebay that have already lowered there projections some by near 75% from last year and are now seen by the market to be doing great business and stock going back up. http://www.Dman-N-Company.com
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posted on September 1, 2001 01:08:28 PM
eBay projected revenues going from $500 million to $3 billion by 2005.
That's a 50% increase per year.
Once ebay sees they are going to miss the target growth, they will probably raise fees to at least temporarily increase revenues.
eBay is a huge flea market and that is all it ever will be. As a flea market, it is about as big as it can be and sustain some visibilty for all sellers.
You're looking at an $8 to $12 a share stock for eBay if the growth stops.
As this comes about, look for more and more fee based services, and increasing fees across the boards.
posted on September 1, 2001 02:03:29 PM
"What I am specifically worried about is that if they suffer a stock crash due to not meeting investor expectations is there a danger the service as we know it may be shut down? "
posted on September 1, 2001 02:55:57 PMTheir projections are way too high. They will never be able to support the amount of sales it would take to do $3 billion per year.
Granted eBay doesn't crash again. And Again. And Again...
Hopefully, they make the shareholders happy. Or they'll be hell to pay...
That reminds me...how is my BNSF stock right now...
:\\\\\\\"Crystalline Sliver cannot be the target of spells or abilities.
posted on September 1, 2001 03:54:27 PM
The flea market assertion is dead on.
Auction venues are and always will remain a haven for collectibles, memorabilia, antiques, rare/unique items, and junk people just want to get rid of.
In other areas, particlarly consumer goods, online auctions are a dying fad.
Sellers have been discouraged by final bids that barely cover the cost of the item, along with listing fees and commissions. Compund that with eBay's "no link" policy, and it's no longer viable to simply write your listings off as a loss leader to advertise your business.
The same goes for buyers, who have largely come to realize that it's a lot easier to pay $50 up front for widget A, rather than monitor an auction for widget A for up to a week in the hope of saving a few bucks.
Everything is still settling, but there's a reason why Amazon and Yahoo! are downsizing their auction efforts and putting more emphasis on their fixed-price venues. The collectible/memorabilia/antique market is saturated, eBay owns it, and there's no point in putting forth an incredible amount of time and effort in order to try and wrestle away a merchandise category that has little or no prospect for future growth.
There is no doubt that eBay will remain the "king of all auction sites" for the forseeable future. What is highly debatable is whether or not there is any opportunities for expansion in this field
posted on September 1, 2001 10:38:55 PM
I don't think eBay will be going away anytime soon. But I do think Meg was a little naive to project such an unbelievable growth for eBay.
As someone else said, eBay is a flea market and always will be. It's pretty much oversaturated as it is with nearly every type of item that could possibly be sold. I don't see double digit growth there. I personally feel that if eBay decides it is REALLY serious about meeting the earnings projections, it will have to establish a separate brand for shopping which complements the auction site.
For instance, it would be expensive, but possible, for eBay to purchase the Yahoo Store concept from Yahoo, and let that be eBay Stores. And totally trash their current lame store concept.
posted on September 1, 2001 10:57:01 PM
eBay's branding and no links policy is why it will never be more than a flea market.
Name brand retailers do not want their brands diluted by selling on eBay.
Thus far there is not one seller on eBay that has been able to create a "brand" using eBay. eBay is the only brand on eBay, and the sellers are all interchangeable.
As far as eBay "going out of business" by missing estimates in growth, no way.
However, a new corp like eBay missing estimates will have a far greater impact on its valuation than if a long standing corp like GM misses estimates. GM has nearly a 100 year track record of ups and downs, eBay is in unchartered territory regarding its market and has a P/E ratio nothing like GM's.
posted on September 2, 2001 02:56:08 AM
Listing fee increases...
They need to hire a consultant to tell them that they need to add value when they jack up their fees. For example...
If they raised their minimum fee to $.45 they should increase their $ value to say $24.99. This would greatly increase their fees, while not necessarily impacting the sellers that much excepting those selling $2-10 widgets. Items that will sell only for $10 or less will be impacted. Items that inexpensive are not really worth the time to list if it's a one of a kind item. If it's a new item that you have multiples of, then list several on dutch for the same fee.
But when they increase their fees and reduce the services, that is what gets all of us P.O.ed... Lately all they have been doing is raising the fees and reducing the sellers (their paying customers) services.
They should also consider lowering the category feature auction prices, I think they are too high for 75% of the auctions. If the price was a lot less, they would get a lot more business thereby generating more income from that feature than they currently are.
Sorta Reaganomics... lower taxes and the income tax revenue soared... Ebaynomics?
