At a conversation today we got into a discussion about how ebay can compete with amazon. Which alone is enough content for an entire post, as they really aren’t playing the same game so not really competing. Instead I’d like to talk about where the conversation progressed to. To me the most interesting thing about ebay isn’t how they won the long tail, or how users are unhappy with the increasing costs placed on them. Instead its more at the level of where they really lost out.

You see, ebay had a devoted following back around 2000. Millions of people would visit their site, buy items, focus on their feedback rating, often spending time in the same category. While at the time most of this was indeed innovative, they stopped there. If they had only taken it a step futher and exposed the final piece of the puzzle by allowing users to interact with each other. If they had developed a network of users that could communicate with each other, that shared interests based on product categories, they could have easily been one of the largest early social networking sites out there. As facebook initially exploded as a social network for college students, and other more recent ones focusing on younger crowds, meanwhile you have linkedin to as a professional network. Ebay could have very much been the network for collectors, or anyone purchasing similar items. Not only would have this increased user engagement, it would have driven more sales.

Take for example if I’m a fan of a particular brand of jeans. I may be very proud of the brand I’ve found, but recently discovered some that were newer and more hip. Well I’m going to be a bit more hesitant to share that with my friends I hang out with as I want to be the one that’s hip versus everyone else having them as well. However if I have a similar community that I connect with online, I can share this information, build a repoire with them, and still maintain my step ahead of friends. It allows your users to become you product recommendation engine versus the Amazon approach of through a lot of machine learning at the problem.

And the most unfortunate part of it all, I’m not sure ebay even realizes they missed the boat.