"I got it on eBay" has barreled its way into the lexicon of the new millennium, placing a cyber-grin on the corporate face of this online auctioneer. Trading goods every second of every day, eBay offers an online forum for selling merchandise worldwide, from fine antiques to the latest video games. eBay generates revenue through listing and selling fees and through advertising, and boasts more than 155 million users. Its e-commerce platforms include StubHub and Half.com. eBay also has a mobile version of its service, and owns e-commerce services provider GSI Commerce, as well as a minority stake in online classifieds service craigslist.
More than half of eBay's revenues are generated outside the US. eBay has a strong focus on Europe. Its top-earning foreign markets include Germany, the UK, and Canada. The company's classified websites are available in more than 1,500 cities around the world.
Sales and Marketing
eBay spent more than $1.3 billion on advertising during fiscal 2014.
eBay’s revenue increased by 12% in fiscal 2014 compared to 2013, from $16 billion up to $17.9 billion, driven primarily by increases in net revenues from each of company’s business segments.
Even with the increased revenue the company’s profits declined by 98% in fiscal 2014 compared to the prior period, from $2.86 billion down to just $46 million, due to increased operating costs which includes tax liabilities, sales and marketing, product development, and other administrative expenses.
In fiscal 2014, cash generated by operating activities increased compared to 2013 even with the dip in net income.
Whether online, through the mobile channel, or offline, eBay’s monetization strategy remains the same. The company is primarily a transaction-based business model that generates revenue through its e-commerce platforms. The company also generates revenue through marketing services, classifieds, and advertising. eBay has struggled to grow in recent years amid competition from e-commerce rivals like Amazon.
EBay spun off PayPal into an independent public company during 2015.