Back to top

eBay, Facebook Team Up for Daily Deals on Mobile Marketplace

Read MoreHide Full Article

eBay Inc. (EBAY - Free Report) and Facebook (FB - Free Report) have reportedly partnered to offer daily deals on Facebook’s Mobile Marketplace.

Per a report from The Verge, the collaboration is in a test phase and aimed at assessing whether people visiting Facebook’s Marketplace are interested in discounted products.

The new feature is currently available to select users who can browse for eBay deals on Facebook's app. However, they can check out only through eBay’s site.

Investors will surely keep an eye on such moves to see whether these can boost eBay’s stock that has underperformed the industry year to date. It has returned 18.7% compared with the industry’s gain of 46.4%.

Deal Benefits

eBay will get another way to boost its Marketplace by offering its platform features to Facebook and getting access to the latter’s huge user base in return.

eBay Inc. Revenue (TTM)

With a similar intention, eBay struck a deal with Shopify (SHOP - Free Report) last month. The duo launched a new sales channel, an integrated platform that allows Shopify sellers to synchronize inventory information, sell products ordered on eBay and view eBay buyer messages directly from Shopify accounts.

eBay is currently re-platforming itself by building product catalogs on structured data, enhancing mobile platform, rolling out new browse inspired shopping journeys and strengthening its brand. It appears that with moves like these, eBay is trying to put these efforts to gainful use.

As far as Facebook is concerned, the deal will help it go beyond peer-to-peer sales by leveraging on eBay’s scale, brand awareness and advanced e-commerce capacities.

Our Take

Facebook launched its Marketplace last year. It allows users to buy and sell items within their local communities. It’s been considered as a competitor to eBay’s Classifieds platforms that provides a very important way to capture the local customer-to-customer opportunity and often represents customers who are selling items more suited to a local transaction.

It appears that Facebook is gradually realizing the difficulty in beating eBay’s strong position and unique capabilities in the space and better off partnering with the market leader.

This week, Facebook expanded its Marketplace to 17 European countries - France, Spain, Germany, Italy, Finland, Denmark, Portugal, the Netherlands, Ireland, Sweden, Norway, the Czech Republic, Austria, Hungary, Luxembourg, Switzerland and Belgium.

Zacks Rank and Stock to Consider

Currently, eBay has a Zacks Rank #3 (Hold). A better-ranked stock in the wider technology sector is Advanced Energy Industries (AEIS - Free Report) with a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Long-term expected earnings per share growth rate for Advanced Energy Industries isprojected to be 13%.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>

More from Zacks Analyst Blog

You May Like