EBay Firms Up Local Strategies

In case you haven’t noticed, eBay has been ramping up a local strategy in the past few months via the integration of all its vertical properties with its home site, the $75 million purchase of Milo.com, and today, a $200 million acquisition of Brands4Friends, a fashion-oriented, German e-commerce site with 3.5 million members and 200 employees.

EBay’s efforts to acquire new local and vertical properties and integrate them with the home site is a perfectly logical growth strategy. Despite its perceived decline in the marketplace, eBay in 3Q 2010 saw 2 billion U.S. product searches — well ahead of competitors such as Amazon, which saw 847 million product searches, and Google, which handled 226 million product searches over the same period.

The push into local certainly represents a major change for the company. In the late 1990s, eBay backed off a comprehensive local strategy when it determined that a “Local Trading” feature concentrating on items that were too heavy to ship (i.e., sofas) didn’t have the traction to really work. Instead, it concentrated on building up eBay Motors, while adding various other verticals, such as Rent.com, an apartments site; StubHub, the ticket scalping site; and various classified services, such as Kijiji (eBay Classifieds), initially developed as a Craigslist lookalike service.

More recently, eBay worked on a new prototype for a comprehensive local portal, using eBay Motors as a base, while including its various classifieds properties, as well as other services. But that effort seems to have gotten lost in the midst of major corporate changes.

Inevitably, however, eBay has continued to push up against local as it looked for paths to growth. Five years ago, it acquired a site that eventually became eBay Stores, which now competes with players such as Web.com.

Milo CEO and Founder Jack Abraham tells us that eBay is handling the absorption of his site at the highest level. CTO Mark Carges personally led the acquisition effort, and VP of Engineering Dane Glasgow has been charged with the absorption. Abraham notes that the 25-person company’s small size makes it easy to move right onto the eBay campus. He also says that his team may be deployed on other eBay initiatives beyond local.