eBay's “full funnel” pivot pays off in post-pandemic bounceback | WARC | The Feed
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eBay's “full funnel” pivot pays off in post-pandemic bounceback
eBay, the global e-commerce marketplace, is seeing the benefits of increased marketing investment and pivoting towards a “full funnel” approach as it bounces back from a pandemic-era slump.
“Heading into the pandemic, volume was declining. Since that time, we have invested in game-changing product experiences and adjusted our approach to marketing,” said president and CEO Jamie Iannone, on the company’s recent Q3 earnings call.
This had improved the company's gross merchandise value (GMV) compared to its pre-pandemic levels, he added.
Why it matters
eBay was once a prime example of under-investing in brand building. Back in 2015, its budget was split 90:10 in favour of performance over brand-building investment.
Not only was eBay “mining the same group of customers” and not bringing in new ones, but the brand had trust issues and investing in performance marketing couldn’t address those. To remain competitive, eBay needed to change tack.
Focusing on the full funnel
In pivoting back to a “full funnel” approach, eBay is seeing the results of changing its marketing strategy, helped by further investments in customer experience and search.
By improving its search experience, the company was able to boost conversion rates earlier in the customer journey to the tune of more than $0.5 billion in GMV annually.
Meanwhile, growth in focus categories – including automotive parts, sneakers, trading cards, and second-hand goods – was up more than 20% year on year.
Iannone explained that these categories had narrowed the gap in market growth rates through higher customer satisfaction, increased trust and more effective marketing.
“Motors parts and accessories is the largest category we have invested in to date, and it is nearing market rates of growth," the CEO said.
He added that investments in marketing over multiple quarters had attracted more enthusiasts, which expanded the top of the funnel. These enthusiast buyers are spending more time on eBay. In Q3, first-party ad revenue was US$249 million, up 27% year over year, growing more than 30 points faster than GMV.
“Part of our strategy, and the shift in our marketing, was really to approach full-funnel marketing and move away from just lower-funnel optimization. That's worked out really well for us,” Iannone said.
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