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eBay’s amazing turnaround, and why CEO John Donahoe doesn’t like seeing Amazon boxes in the offices

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John Donahue

High-ranking Microsoft execs like CEO Steve Ballmer bristle when they see employees carrying MacBooks or iPhones around the office. So, what’s the equivalent at e-commerce juggernaut eBay?

Well, you guessed it: Amazon.com boxes.

At least that’s how we’re interpreting a comment that eBay CEO John Donahoe made to employees at a recent gathering in Silicon Valley.

“I see competitors’ boxes coming to our mailroom,” said Donahoe, as reported in an in-depth profile on eBay in Fortune this month. “You should be using our products and using PayPal products wherever you see them.”

As Business Insider notes, Donahoe didn’t mention Amazon.com by name, but we’re assuming he was referring to the longtime rival.

The profile in Fortune by JP Mangalindan is definitely worth a read, showing how Donahoe has led eBay back to success. The stock is up 71 percent in the past 12 months — nearly on pace with Amazon’s meteoric 77 percent increase.

eBay is actually expanding rapidly in Amazon’s backyard, inking a lease for 53,000 square feet of space in Bellevue. The new office, led by Microsoft vet Ken Moss, is about double the size of the company’s existing footprint.

The Fortune report also points out how eBay is transforming itself into a provider of e-commerce tools and logistics, essentially becoming ”the shopkeeper’s best answer to Amazon.” In other words, while Amazon is looking to dominate other retailers or compete alongside them, eBay wants to provide tools like PayPal to make existing retailers even better. Writes Mangalindan:

Amazon’s insatiable desire to dominate all of retailing proved to be an opportunity for eBay — a chance for the platform to become a sort of Switzerland of e-commerce, helping retailers fend off a common foe. “eBay wants to partner with the market sellers of the world, not put them out of business,” says Devin Wenig, president of Marketplaces. Indeed, eBay doesn’t compete directly with its retail partners — it isn’t peddling books and shoes and diapers alongside them.

  • Brent

    Yeah, maybe I’m dating myself but the concept of bringing your competitor’s product to work demonstrates a lack of confidence and pride to me. Not talking about product groups that needs to operationally because they support a competitor’s platform or groups buying competitors products to better understand their strengths and weaknesses – those all make sense to me. But if you’re an Ebayer ordering up Amazon stuff or a Microsofty rockin a Galaxy S3 at work, I don’t get it. But apparently times have changed.

    • Harkonnen

      I’ll agree that sporting a Mac while working at Microsoft is a punch in the eye, but eBay does not do what Amazon does so I think Donahoe needs to get over himself or expand the business model.

  • Gene K

    I understand what the CEO of eBay is ultimately aiming for, however, I believe leaving employees to naturally react to the free market keeps your edges that much sharper. I don’t intend to purchase CPG based on anyone else’s tastes while selecting B2B products based as much on politics as anything else. The reason for being, it keep you as an honest observer with fraction of cost per person. The market can only be changed when employee’s will is internally motivated by the company’s technology, culture and products and services, that’s where the wild fire starts. So to see your employee having a more keen eye towards another company’s brand is an opportunity to study who makes up this market and who understands them best. Otherwise we are creating bunch of sleeping sheep.

  • http://twitter.com/fijiaaron Aaron Evans

    ebay is still around?

  • Guest

    Having tunnel vision is a misguided approach for eBay. Banning Amazon parcels from eBay offices is an incredibly selfish thing to do. If I were running eBay, and next month I probably will be, I would encourage my employees to be customers not just of eBay but of e-commerce. Try everyone. What do certain companies do well? Where could eBay improve its experience? Without enough context about its customers and about its competitors, a company is ill-equipped to make decisions to keep it competitive.