Once Disorganized, eBay Partners Now a Vibrant ChannelBy Pedro Pereira | Posted 2006-03-13 Email Print
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At first eBay didn't quite know what to make of the developers that were "screen scraping" to get a piece of the action at the online auction site. But eventually the company embraced the growing number of developers as partners and now is thi
For many eBay users, the online marketplace is a place to find a bargain or offload items they no longer need. But for thousands of people, eBay has become a way of life.
Those people include some 25,000 software developers that have built businesses around providing better tools for eBay sellers and buyers.
These application developers essentially constitute a partner channel that came about by accident. Shortly after eBay came on the scene with its auction site, developers wanting a piece of the action started popping up.
At first they were nothing more than scraggly pockets of weeds in the vast and varied field of application development, but today they are an intricate ecosystem that continues to grow.
In providing layers between sellers, eBay and buyers, the application developers pick up where San Jose, Calif.-based eBay leaves off.
They write applications that allow hawkers, peddlers and merchants a more granular approach to researching what to sell, when to sell and how much to expect for the sale.
Applications sift through historical sales data, gather statistics and organize the data in meaningful ways.
Some applications handle inventory and order management, and offer reporting capabilities that allow users to keep track of such data as pricing and volume.
These applications are especially useful to sellers that list thousands of items, said Greg Isaacs, director of eBay's developers program. Without them, sellers would have a hard time tracking inventory and managing their sales.
Sellers taking advantage of the applications in many cases are anything but casual eBay users.
"A vast majority of my customers are using eBay as their primary business platform," said Dave Cotter, CEO of Mpire Corp., an eBay-affiliated developer in Seattle that boasts more than 10,000 customers.
Cotter founded Mpire in December of 2004 specifically to develop applications for the eBay platform. The company helps small businesses determine the best time to sell specific items and, using historical data, figure out how much to expect to earn from the sale and what the starting price of an auction should be.
Using Mpire's search and listing capabilities is free to sellers, but the developer charges for its more high-end tools, including financial reporting, consignment management and monitoring of active listings, Cotter said.
Cotter and other developers say eBay has made it easy for partners to work with the company, even making the API that developers need to build their applications available for free last fall.
eBay didn't always embrace partners.
eBay, partners say, has embraced the developers' efforts because the company recognizes the value this channel has built around the eBay platform. That wasn't always the case, though.
"They [eBay] didn't know what to make of us in the beginning. Nobody had a vision of this developer community in the beginning," said Paul Lundy, executive vice president of marketing at Marketworks Inc., Atlanta, eBay's first certified solution provider.
Marketworks started building applications for eBay users in 1999, seeing an opportunity to provide an interface between the online marketplace and sellers, Lundy said.
Back then, Marketworks was doing what is known as "screen scraping," a process by which a company collects information from a Web site for its own use.
Marketworks targeted eBay's biggest customers as potential clients and eventually caught the company's attention. So much so that today the company has a developer team dedicated to working with the partners, who Isaacs said essentially act as eBay's consulting arm.
"They actually augment our product development efforts," he said.
The developers, he added, add a level of differentiation to sellers that the company does not provide. From an eBay perspective, industrial dealers and peddlers of collectibles looks the same.
Marketworks, for instance, helps sellers of construction equipment distinguish themselves.
"We worked with eBay just recently to develop a special product offering for heavy equipment sellers," Lundy said.
To support its developer partners, eBay has built a channel program with several layers. At the bottom layer are developers that make no more than 10,000 API calls a month to eBay, Isaacs said.
The middle layer makes more than 10,000 calls and gets some support from eBay.
The top layer consists of the eBay certified solution providers who pay $3,000 yearly for the distinction. Certified providers enjoy closer integration with the eBay platform and custom software development. To qualify, certified providers must have at least half of their staff pass an exam that assesses their technical and business competency.
The number of eBay partners doubled in the past year to 25,000 and Isaacs believe the ranks will continue to swell. He said 25 percent of eBay's 70 million worldwide listings are posted through partner applications.
With numbers like that, it's easy to see why eBay has taken an interest in their partners. Isaacs said the company this year is focusing on strengthening its partner support through marketing initiatives.
The idea is to provide directories and matchmaking services through diagnostics and intelligent technology to pair up sellers with the developers that can address their needs.
"We need to get a little smarter about segmenting those companies and recommending them to resellers," Isaacs said.
eBay also is working with developers on the buying side. One feature the company plans to launch this year is cell phone alerts that notify buyers that an auction is about to end, giving them one last chance at placing a bid, Isaacs said.