Inaugural eBay Index Spotlights Small-Business Optimism and Online Retail Economy

SAN JOSE, Calif.--(BUSINESS WIRE)--eBay, the world’s largest online marketplace and a leader in mobile shopping, today announced the results of the first U.S. Online Business Index (OBI), a new report that highlights small-business owners’ views across a range of business topics. The inaugural U.S. report shows that the spirit of entrepreneurship is alive and well this holiday season, and showcases small businesses’ strong opinions about the importance of mobile commerce and impact of the proposed Internet sales tax to their online success.

“Small businesses are the backbone of the U.S. economy and the leading source of job growth in our country, so it is of particular significance that eBay will elevate important business themes and ongoing business outlook from top entrepreneurs who are building successful online businesses.”

“The U.S. Online Business Index is meant to surface important issues facing online businesses and ultimately help us better support the millions of small businesses and entrepreneurs on eBay,” said Todd Lutwak, vice president of seller experience at eBay. “Small businesses are the backbone of the U.S. economy and the leading source of job growth in our country, so it is of particular significance that eBay will elevate important business themes and ongoing business outlook from top entrepreneurs who are building successful online businesses.”

To gather insights about the state of online small business, eBay surveyed more than 400 sellers on topics ranging from holiday sales to mobile commerce prospects and proposed Internet sales taxes.

Holiday Optimism and 2011 Growth

Small online businesses are ideally positioned to take advantage of the increased consumer spending across ecommerce¹, and the majority of the eBay small-business owners surveyed forecast strong performance for the holiday 2010 season:

More than half (60%) of the eBay small-business owners surveyed said they are considerably optimistic about the future of their online businesses in the 2010 holiday shopping season.
Almost three-quarters of those surveyed (72%) expect their total online sales to increase during the holiday months of October through December.
Similarly, in an Online Business Index survey of top eBay sellers in the United Kingdom, 62% agree that they expect the holiday months to be their busiest of the year despite the continued tough economic climate.

eBay entrepreneur Isaac Yoselovsky, manager of eBay store aSavings, is already seeing indicators of a strong holiday season and has hired seasonal staff to help with increased volumes of consumer electronics, toys, games and sporting goods. “We’re looking forward to the holiday shopping season this year, and have doubled our shipping staff in anticipation of increased sales,” he said. “We’re already seeing strong sales – it took us only eight hours to sell 2,000 Zhu Zhu Pets® during an eBay Daily Deal well before Black Friday this year, and we’re expecting fourth-quarter sales to be double or triple what we sell in other quarters.”

In a year-over-year comparison, the index also shows that 80% of U.S. OBI respondents expect to carry the same or more holiday inventory on eBay in 2010, showing further confidence in their holiday sales outlook. Of these, 36% plan to increase their inventory through 2011 by up to 15% or more.

In forecasts for 2011 online sales, more than half (53%) of the OBI small businesses surveyed plan to raise their sales targets from 2010. The majority of these respondents (66%) are targeting increases of up to 20%.

Mobile Makes Move to Seller Significance

The U.S. Online Business Index is the first time eBay has asked small businesses about the impact of mobile commerce to their online business strategy. Results show index respondents want to increasingly take advantage of the buying and selling options available to them via smart phones and mobile devices.

73% of respondents say it is important to them that shoppers have the ability to browse and buy items on eBay using mobile devices
60% say they are willing to adjust their eBay listings for easier viewing on mobile devices

Sellers Reject Internet Sales Tax Proposal

OBI participants expressed strongly negative sentiment when asked about the possibility of an Internet sales tax, with 88% of respondents saying they would not support it, and 81% saying they would support a small-business tax exemption in the event the proposal was put into law.

Key drivers of small-business sentiment included fear that an Internet sales tax would:

Reduce the number of online transactions (74%)
Reduce online small businesses’ out-of-state sales (69%)
Make it difficult to maintain business profitability (69%)
Negatively impact the U.S. economy (68%)

eBay launched the Online Business Index in the U.K. in 2008 as a barometer of small-business sentiment across a range of business topics. It has since expanded to Germany, France, Australia and now the United States. The 435 small businesses participating in the survey were required to have been selling on eBay for at least six months, to have sold at least one item on eBay in the past six months, and to be the primary decision makers of their businesses on eBay. Surveys were administered online by Decipher Inc. between Sept. 13 and Sept. 19, 2010.

¹NRF: Black Friday Weekend Sees Bigger Crowds, $45 Billion in Spending press release

About eBay

Founded in 1995 in San Jose, Calif., eBay Inc. (Nasdaq:EBAY) connects hundreds of millions of buyers and sellers globally through eBay, the world's largest online marketplace, and PayPal, which enables individuals and businesses to securely, easily and quickly send and receive online payments. We also reach millions through specialized marketplaces such as StubHub, the world's largest ticket marketplace, and eBay classifieds sites, which together have a presence in more than 1,000 cities around the world. For more information about the company and our global portfolio of online brands, visit www.ebayinc.com.