Is eBay Inc (EBAY) Exploiting this Shift in Industry Dynamics?

The biggest advantage to the online shopping stores over brick and mortar stores is that they do not face any barriers when targeting customers in any part of the world. They are just one click away from their target customer. However, the business heavily depends on an effective delivery system.

The big names in this industry, like eBay Inc (NASDAQ:EBAY), Amazon.com, Inc. (NASDAQ:AMZN), Wal-Mart Stores, Inc. (NYSE:WMT), are nearing saturation in the U.S. market. The key to their successful survival for these big players lies in their ability to increase their international presence.

eBay Inc (NASDAQ:EBAY) is taking steps to increase its international market share

Source: eBay – Financial Releases

In the light of continued transition from print classifieds to online classifieds, eBay Inc (NASDAQ:EBAY) is leveraging the shift in market dynamics by adopting an aggressive growth strategy. Classifieds are now becoming the preferred e-commerce format worldwide and hence, represent an attractive market.

Recently, the e-commerce giant bought two leading Belgium online classified websites, 2dehands.be and 2ememain.be, as the company continues to pursue its international growth through acquisition under its Marketplace segment. The company has also restated regarding its international expansion strategy that it plans to follow it, which it has done so with its previous investments in India and now in Germany.

eBay Inc (NASDAQ:EBAY)’s motives behind the acquisition of these sites is to increase its presence in the European markets. Even at present, a major chunk of eBay Inc (NASDAQ:EBAY)’s sales turnover comes from the international market. Also, it makes the company less dependent on the U.S. market for generating its sales, should the U.S. economy be hit by financial crisis in the future.

The two relatively popular websites will form part of the Classifieds group, and attract traffic of 5.5 million unique visitors on a monthly basis. This accounts for approximately 50% of the population of Belgium.

eBay Inc (NASDAQ:EBAY) Classifieds Group further plans to spend more on the development of the local Belgian business, developing the platforms to deliver a faster pace and be more intuitive for the active users. In addition, it is a complement to the eBay’s existing expertise in creating leading mobile platforms. In the light of the huge upside for mobile growth for 2dehands.be and 2ememain.be, the development of novel mobile technologies will be the target of the company in the future as well.

Last month, eBay secured a multi-year contract from SCA for fulfilment, order management, freight and customer care solutions in the U.S. and Canada. This contract is likely to result in higher revenues for eBay in the coming years.