New Leader, New Focus

As new eBay CEO, Donahoe wastes no time setting changes in motion.

by staff writer
- Mar 25, 2008

To call John Donahoe, eBay's new chief executive, a "mover and shaker" would be an understatement. Within a week of being named to succeed longtime corporate honcho Meg Whitman, Donahoe was already making changes that would rock the online auction world to the core.

Before even assuming the official title of CEO on March 31, Donahoe (pictured) riled longtime eBay users and incited a widely publicized seller's boycott in February by launching changes to eBay's fee structure and feedback policy.

The recent unrest within eBay's membership has put the e-commerce powerhouse under a microscope at a time when analysts and stockholders were already questioning whether eBay's growth has peaked.

Donahoe joined eBay three years ago as president of the company's Marketplaces division, and was tasked with expanding eBay's global footprint and product portfolio. As head of the world's largest online marketplace, Donahoe faces a number of business challenges, including:

  • Slowing growth. After 10 years, eBay's core auction business is maturing. In January the company projected revenues for 2008 would grow to nearly $8.75 billion, or 13.6 percent. Wall Street was looking for 17.1 percent growth, and responded by erasing 5 percent of eBay's stock value.
  • What to do with Skype, the Internet telecommunications company acquired in 2005 for $4 billion. Though it's a rapidly growing company, critics still question how Skype fits within eBay's business model.
  • Increasing competition. is a growing threat to eBay's auction business and has been luring away some PowerSellers. Smaller auction sites have been slow to gain traction, but some experienced at least temporary spikes in activity in the wake of eBay's policy changes.

The changes at eBay, which largely favored big-time sellers, were seen by some as an attempt to win back some of the business lost to Amazon.

Donahoe has also indicated eBay will put more emphasis on fixed-price listings. According to eBay, fixed-price sales already represent 40 percent of Marketplace revenues.

About the Author

Auctiva staff writers constantly monitor trends and best practices of those selling on eBay and elsewhere online. They attend relevant training seminars and trade shows and regularly discuss the market with PowerSellers and other market experts.

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