As eBay continues to restructure its business, it’s shuttering one of the efforts it had made to expand its commercial footprint outside its own marketplace and walled garden.
The company announced today that on May 1 it will be shutting down the eBay Commerce Network — a network that it runs where merchants advertise products that match content people browse on those third-party sites, with the ads going back to merchants’ own domains — as it puts more of an emphasis on some of its other advertising efforts, namely affiliate marketing and advertising on eBay itself.
The move is a key play for eBay as it works on building its own database of information about shopping, and crucially creates an opportunity for it to make better margins out of potential sales, rather than from the incremental clicks on ads themselves. The company made $600 million in advertising revenues in 2018 and has a goal of increasing that to $1 billion this year through changes like this.
“Thank you for your partnership with eBay Commerce Network,” the company said in a statement on the site. “We’ve been proud to see our platform evolve over the past two decades. We want to continue providing customers with the best possible selling and buying experience. As a result, we are focusing on business that complements our core marketplace and discontinuing eBay Commerce Network effective May 1st, 2019. We are committed to enhancing our advertising portfolio throughout 2019 and hope you consider exploring our advanced core advertising and affiliate marketing opportunities.”
The company said in a Q&A that it will be issuing refunds to merchants who had any balance remaining in their accounts, as well as paying out any balances to publishers, from the middle of May.
Other products that will stay online include Promoted Listings and, for publishers, the eBay Partner Network, which covers 1 billion+ listings on eBay. But for these, merchants will need to sell the items directly on eBay, as links will no longer go to third-party websites.
The eBay Commerce Network first emerged in 2013 as a rebrand of Shopping.com, a comparison shopping site it bought back in 2005 for $620 million. In 2013, adtech had started to take off as a big growth area, and so, with Shopping.com having diversified by building an ad network for third-party sites, eBay saw an opportunity to double down on that.
Bridget Davies, eBay’s VP of advertising, confirmed to TechCrunch that as part of the closure, listings that had been run on Shopping.com — which was still active, acting as a “publisher” on the Commerce Network — will also no longer appear. “We’re going to retain the domain, and we’re currently deciding what we will do with the asset,” she said.
There are many ways that retailers can target would-be shoppers online these days after they indicate an interest in a particular product — from Google Shopping, to retargeting networks and more. Collectively, the scale of these operations can be vast.
But in that regard, the eBay Commerce Network, which connected consumers globally through operations in France, Germany, United Kingdom, Australia and USA was a relatively modest effort. In earlier years it had around 2,000 publishers, targeting some 250 million consumers. Today, only around 1,000 publishers and less than 1,000 merchants today were using it.
It was also built around the use of third-party data — collected from outside eBay — and eBay has in the recent years made a bigger strategic shift from third-party to first-party data.
(That’s something that others have also done, although for different reasons: Facebook last year discontinued Partner Categories, a third-party data-based ad targeting service, in the wake of the Cambridge Analytica scandal.)
The big questions will be, going forward, if eBay has enough merchants on its site today to grow that first-party advertising business, and to complement that, if its policy of only promoting eBay listings will be an attractive enough proposition to attract more new merchants to the platform.