Today eBay officially announced its much-anticipated new service, eBay Express (read the release). From what I can tell (I haven't tried it yet myself), it is essentially a separate site for customers who are looking for new stuff and not only want to skip the auction process, but want to buy from several different sellers all at once. Only "qualified eBay merchants" are allowed to sell from the site. That should provide users some assurance that what they buy will actually arrive and be in the condition they expect.
Bill Cobb, president of eBay North America, explained the goal pretty clearly in the release, "eBay Express is for buyers who prefer a more conventional online shopping experience," he said. "We think eBay Express will attract new buyers to eBay and inspire existing buyers to use eBay even more."
I think eBay Express is a good idea and I plan to use it (I'll write about my experience here). But for investors, I want to point out that this is a major new step in eBay's evolution of becoming an e-commerce retailer -- not an auction site.
Here are some quick observations on the significance:
- Consider this sign number 412 that the online auction format of people selling their used stuff to each other is pretty much tapped out for eBay in terms of growth.
- eBay is becoming more and more a place for professional sellers, not an alternative to a garage sale.
- eBay Express could result in lower average selling prices for the company, since items sold at a fixed price are usually lower priced than the items sold at auction. (Wall Street analysts track this closely).
- But if it brings a lot of new buyers into the system, it will be a major positive for the company.
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