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What Is The New eBay Enterprise Marketing Solutions All About?
We asked the new CEO of the eBay spinoff, following several months in which it acquired two companies.
Last summer, while attention was focused on eBay’s PayPal sale, the online marketplace was also spinning off its eBay Enterprise unit.
Earlier this week, the new standalone company eBay Enterprise Marketing Solutions announced it had purchased AffiliateTraction. This comes on top of eBay Enterprise Marketing Solutions’ acquisition in November of performance marketing firm Digital Net Agency (DNA).
We checked in today with the CEO of the new eBay Enterprise Marketing Solutions, to see what the vision was.
“It’s been a wild couple of months,” Michael Jones told me.
The Last Few Months
But first, let’s review those other eBay Enterprise sales and acquisitions that have created the company’s current shape. It’s a bit complicated at first, so better sit down:
Largely propelled by its purchase of GSI Commerce in 2011 for $2.4 billion, eBay’s eBay Enterprise originally had dreams of getting closer to larger retailers, which might set up eBay-run online stores.
GSI’s technology, services and warehouses were employed by the likes of Toys “R” Us and shoemaker Kenneth Cole for website management, online marketing, payment processing and customer service. The obvious competitive target: Amazon.
But the online marketplace eventually decided it wanted to focus on its core business. In July, around the time it sold PayPay, eBay sold off eBay Enterprise to a consortium of private equity firms.
The consortium split eBay Enterprise into four companies, each owned by various combinations of the equity firms.
One part was bought last November by Zeta Interactive, co-founded by ex-Apple CEO John Sculley. It purchased eBay Enterprise’s customer relationship marketing division, which included an email service provider. Zeta manages brands’ customer data and other kinds of marketing.
A second company was based around the popular Magento e-commerce platform, and kept that brand name.
A third company focused on the GSI Commerce components relating to retail order management between a web store and inventory, customer service, and some anti-fraud technology, and retained the name eBay Enterprise. It also kept the nearly one dozen warehouses.
A fourth company also initially kept the family name, and is confusingly calling itself eBay Enterprise Marketing Solutions.In December, advertising and conversion platform Ve Interactive announced it had purchased the display retargeting business from eBay Enterprise Marketing Solutions.
Laureen Ellison, head of marketing and communications at eBay Enterprise Marketing Solutions, pointed out that eBay Enterprise and eBay Enterprise Marketing Solutions are both headquartered in King of Prussia, Pennsylvania, with offices not far from each other. But both, she said with some relief, will be finding new company names soon.
In light of the recent acquisition of AffiliateTraction, I wanted to find out what the company temporarily known as eBay Enterprise Marketing Solutions is all about.
Jones started affiliate network Pepperjam in the early 2000s, which was sold to GSI in 2009 and then came along to eBay Enterprise two years later. He had been running affiliate networks and digital marketing at the old eBay Enterprise, and he’s been CEO of eBay Enterprise Marketing Solutions for only a few weeks.
But, while the name is still in flux, the new company’s vision is not. It’s centered on performance marketing.
The centerpiece is affiliate marketing, which Jones sees as having received a turbo boost by his company’s just-announced purchase of AffiliateTraction. He pointed out that AffiliateTraction was “the largest affiliate management agency,” and he’s especially pumped about that acquisition’s technology platform. For instance, it recommends which affiliated sites/blogs a brand should have in its network.
Jones ranks his company as third behind Commission Junction (now CJ Affiliate) and LinkShare (now Rakuten) in affiliate networks. But the idea is not only to provide affiliate networks, but also the technological tools and the services to manage other affiliate networks.
“From a size perspective, we’re still number three,” he said, but “from a technology perspective, we’ve probably leapfrogged them.”
An important differentiator for the new eBay Enterprise Marketing Solutions, he said, is that it is “both a technology company and a service business.”
Affiliate networks are those links to retailers that are offered on blogs, publishers’ sites, and other online locations. For instance, Dick’s Sporting Goods — an eBay Enterprise Marketing Solutions customer — makes links available all over the web to the products it sells.
When someone clicks on a link in a blog post to, say, a baseball glove at Dick’s and makes the purchase, the blogger gets a fee. Managing all those links, relationships and payments in the affiliate network — either as the affiliate network, or the tech, or the services – is the core of what eBay Enterprise Marketing Solutions is doing.
“The Holy Grail” Of Marketing
Affiliate marketing cannot be completely automated, Jones noted, describing it as “the most manual of all digital channels.” There are relationships with thousands of bloggers and publishers to maintain, since brands want as many links and as much exposure as possible.
Complementing that affliliate network business at eBay Enterprise Marketing Solutions are other forms of performance marketing, where brands pay fees as a result of user actions. These include search marketing, with search engine optimization, paid social ads, and search ads.
“That’s the Holy Grail” of marketing, Jones said. “To pay for performance.”
He noted that the purchase of the Digital Net Agency was mostly an “acqui-hire” to bring on board that company’s personnel, who are focused on search engine marketing and advertising, as well as affiliate management.
Jones is looking to possibly expand into cost-per-action display ads, where the advertiser pays only when a user takes an action, like filling out a form or making a purchase.
“The dream,” he said, “is to be the number one performance marketing company on the planet.”
“It’s an industry that’s gotten lazy.”
Note: This story was updated to more accurately reflect the fact that there are two companies whose name is, at least in part, eBay Enterprise.