eBay’s Next Few Acquisitions

eBay’s StumbleUpon acquisition is done. I wrote about it, in eBay’s Foray’s into Media. Not much to add on the topic, except that the price has changed. eBay eventually ended up acquiring the company for $75 Million.

One critical point I made in my previous analysis is that eBay needs to plug the leakage in its advertising budget. Today, they spend Millions in customer acquisition costs. Improving on this piece of the P&L would add a lot to the earnings of the company.

The question is, what are the efficient ways of doing so?

One category that has heated up massively in the startup scene is Vertical Search. Collectively, the vertical search engines are driving huge traffic. I have previously written about some of the ones that focus specifically on Shopping: Wize, TheFind, Retrevo, etc.

Each of these have a unique way to pull users into the shopping experience. Wize and Retrevo focus primarily on Consumer Electronics. TheFind focuses on Lifestyle shopping. There are many others. It seems to me, that eBay’s next few acquisitions ought to come from within these Vertical Search portals. Most of them pay commissions to a merchant shopping network like Shopping.com. Under eBay’s parenting, they can all be forced to go through Shopping.com. However, the user experience they each offer, have unique value propositions, and could also be great new entry points into eBay’s shopping engine.

Among other things like moving Shopping.com up the food chain, this would certainly be a good way to keep the advertising money circulating inside the company, rather than making Google richer!