EBay fails to crack China crisis

EBay's consumer auctions in China continue to lose market share despite now being free of charge, according to data from a local market research firm. 

The company's slice of the $674m spent on consumer-to-consumer (C2C) sales in China fell significantly during the past nine months as a smaller rival gained ground, according to figures released yesterday by Beijing-based Analysys International.

Martin Wu, chief executive at eBay China, told AFX News earlier this month that revenue earned by eBay China sellers increased more than 10 per cent in the first quarter, while total revenue for users of China's largest C2C auction firm, Taobao, remained unchanged. 

Although the revenue data from Analysys appears to contradict this statement, it is not clear whether it includes eBay's Stores, which might be classed separately as business-to-consumer transactions instead of C2C.

Analysys confirmed to vnunet.com that the figures it had released were correct, but did not answer a request for clarification of this issue.

In the C2C market, where products are sold by individuals to individuals, Analysys' data shows that eBay users' share of total transaction revenues fell to 28 per cent in the first quarter from an average of 31.46 per cent in 2005.

Revenue generated by C2C sales has risen from approximately $644m in the fourth quarter of last year to $674m in the first quarter of this year, accordin g to Analysys.

The decline continues a trend for eBay. The company was originally the leader in China's online auction market, but the introduction of a free auction service by rival Taobao caused a stampede in the direction of the newcomer in 2004.

In January this year, eBay dropped transaction fees from its basic C2C services in China, but this does not appear to have stemmed the tide.

See also:

EBay claims 200 million users worldwide

Meg Whitman announces milestone at annual user conference  14 Jun 2006

EBay adds 'Skype Me' links to auction listings

US buyers and sellers able to communicate in real time  14 Jun 2006

Skype claims 13 million users in China

China is Skype's biggest market, but certain elements of the service may be illegal  05 May 2006

Feature: Become an Ebay expert

Whether you have items to sell or are looking for a bargain we help you cash in with Ebay  18 May 2006

EBay strikes deal to target China's online millions

Auction site tries to tempt Chinese shoppers to e-commerce  30 Mar 2006

China's online ad income soars

Youth market attracts advertisers to internet companies  27 Mar 2006

China becomes second largest internet nation

Percentage of Chinese surfers grows while US falls  06 Jan 2006

Like this story? Spread the news by clicking below:

 del.icio.us     Digg this     reddit!