What Challenges Does John Donahoe, Ebay's New Ceo, Face in Taking over from Meg Whitman?

What Challenges does John Donahoe, eBay's new CEO, face in taking over from Meg Whitman?

Slowing growth in eBay's core business of online auctions.

• The revenue from this division fell from 72% to 56%.

• This slowing growth in the company's core division was highlighted by a 1 percent decrease in gross merchandise volume, a measure of total sales, in the third quarter of 2008 as compared to sales in the third quarter of 2007 and declining growth rate in the number of register users.

Skype

• Not produced intended results

• Couldn't integrate it with eBay's yet

• Into core operations and to capture the synergies that had provided the original justification for acquisition

• Over paid for Skype

Heading into the Holiday season 2008

• Usually the strongest quarter were down 6 percent from 2007 in the second quarter an this could continue into the 2008 4th quarter

• Donahoe believed it was because of the weakened economy globally

• Customers believed it was indicative of deeper problems, including an erosion of eBay's core customer base and a loss of the company's innovative capabilities.

Analysts believe that eBay could not recover its dominance because of the economy.

• EBay's share of the U.S. e-commerce market had fallen from 19 to 17 percent between 2006 and 2008, while amazon.com's share rose from 3.7 to 5.3 percent over the same time period.

• Ebay stock dropped more than 50% from nov 2007 to nov 2008 from 35.98 to 15.01.

Concern About Donahoe

• Not sure if he was able to lead the turnaround

• Laid off 10% of the employees

• Glassdoor.com

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