Last week GigaOM published my editorial contrasting the rise of Groupon and the long, slow decline of eBay. I made the case that the poor economy–which has been a key driver behind Groupon’s growth–should have benefited eBay, as well. Why not?
The reasons for eBay’s stagnation come down to leadership. During former CEO Meg Whitman’s tenure, the company’s culture became increasingly bureaucratic, and improvements to the site became few and far between. eBay hiked fees aggressively while doing little to improve its user experience. The company misjudged the threat posed by Google’s advertising network, which effectively decentralized ecommerce by making it viable for small businesses to sell directly from their websites. Also, as my former PayPal colleague Keith Rabois asserted, eBay started out as a fun, social ecommerce site but it failed to grasp the advent of social networking.
Click here to read the rest of my piece.