Last Updated Jul 12, 2010 10:15 PM EDT
The auction giant has been working hard to find its way forward, with a new mobile strategy (which seems smart) and some other initiatives (which seem less so). Among its weapons against Craigslist, Amazon (AMZN) and Target (TGT), for example, are specially-formulated mobile apps that appeal to niche shoppers. One of the most promising ones had seemed to be eBay's fashion-oriented app. But with high fashion labels like Marc Jacobs selling via new Web stores, things won't go as planned.
EBay has long been the unofficial clearinghouse for high-end clothing, even as the company struggles with ways to capitalize on its status. (The site's homepage only has two category-specific tabs, and one of them is Fashion. The other is Motors.) It has tried the temporary-offer strategy that has made Gilt and Woot popular, but as my colleague Lydia Dishman has written, its version -- called eBay Vault -- has only achieved mediocrity because it's stocking bottom-of-the-barrel items.
EBay has also tried revamping its fashion channel, adding a more elegant aesthetic. But it doesn't go very far in helping shoppers navigate its millions of fashion listings, and its new "editorial merchandising" features (like a "fashion voice" editor) don't have the clout they need. As limp as its attempt might seem, it may be too much to ask for eBay to really master its fashion business. The site is, at heart, a deal warehouse; it's the place where your product search ends once you find the lowest price. It's not the place where you begin your research.
The site has been struggling to rebound from its year-ago nose-dive, and fashion might have been a powerful element of its recovery strategy. But eBay has failed to realize one of its most potent advantages: the auction process itself. Most of its initiatives have been focused on the lone shopper, but what eBay really needs to do is exploit the natural competition that is deeply ingrained in the high-fashion buyer. The fun of shopping eBay for clothing is finding that one perfect item -- there's not much bulk selling with these items -- and out-bidding your competing fashionistas. The impetus behind buying these items is two-fold. The first is to look good; the second is to look like no one else.
EBay's essential value proposition for the high-end buyer is the chance to find unique items -- but instead of bragging about that, it has set itself up against traditional retailers with more brand clout and better inventory. Because of that misalignment, it might actually lose buyers to the labels' new retail sites, which will doubtlessly boast plenty more panache (zooming photos, live help, slideshows, and better site design are all on deck, says the NYT) despite the fact that the new sites will price items at the full MSRP.
Should eBay keep on with its misguided attempt at being a retail also-ran, it may eventually cede its second-hand and unique-item sales to Craigslist. That site seems to be more in touch with what it actually does -- sell items user-to-user -- and than eBay, which wants to be something it isn't. It's only a matter of time before customers begin to run from the confusion.