E-Bay.in The Dying Giant

It’s been 12 years since the launch of eBay.in, the company which had an early mover advantage has succumbed to competition from much younger rivals such as Flipkart, Snapdeal and its American rival Amazon.

Clearly, eBay’s journey has not gone ahead as per its plan.


eBay India started off as a trading platform offering auctions, quick buys and classifieds modes of person-to-person trading. Auctioning was a popular method of buying products in the US and was seen a good method for price discovery. India, however, was a very different market. A thing like auction wouldn’t quite match the requirement of the customers here.

PaisaPay Trust

Selling online was another challenge. The market was highly immature. There used to be basic inhibitions by buyers — “Will I get the product that I have ordered? Will I get the same product that I have ordered?”

Building in trust in consumers for online buying was a big task. Soon eBay launched its payment platform PaisaPay it would ensure that only after the customer received the product and submitted that he was ‘happy’, will the payment be made to a seller. Else the payment would be returned to the customer. This move helped Mumbai-headquartered eBay India gain some footing.
eBay was touted to be an undisputed market leader and used to be the largest in terms of gross merchandise value, orders and enjoyed over 50 percent of the market share, till almost 2011.

Flipped in a Snap

By then eBay was competing with Bangalore-based domestic rival Flipkart that had raised over USD 30 million in multiple rounds from hedge fund Tiger Global, among others. Launched in 2007, Flipkart now was expanding from being an online book selling platform to offering movies and music-related products, too. Snapdeal which had started off as a deals platform, too by now had started selling products online.

The market soon saw the entry of US behemoth Amazon, which launched its India website in 2013 and started off with categories such as books and movies.

In 2016, eBay’s revenue growth slowed for the financial year ending March 31, 2015, with a revenue of just over Rs 132 crore, a rise of 23 percent against Rs 107 crore during an year-ago period. This, at a time when Snapdeal reported a revenue of Rs 933 crore in 2015.

Coming Merger

eBay is currently in talks with Flipkart for a potential merger, which is raising a USD 1 billion round, with Microsoft, eBay and Tencent as main investors.

eBay’s journey in India offers great learnings for other companies. Local decision-making, investments in marketing, promotions and people have become key to penetrating this growing Asian market.

A merger with Flipkart will at least be a face saver for ebay against its American rival Amazon.


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