eBay should buy QXL according to Michael Jivkov, he argues that QXL has a clear market share in many East European territories whilst eBay is a minor player. In the UK QXL languishes way behind eBay but in Poland for instance QXL has a 95% market share. QXL also intends to move into more East European countries this year and currently faces very little in the way of competition.
By swallowing the group [QXL], eBay would not only remove a potential competiton in the battle for market share in eastern Europe but would overnight become the dominate operator in Poland, Switzerland, Norway and Denmark.
Currently out of the main auction competitors operating in the UK (eBid, Tazbar, Cqout) none of the others are attractive for eBay to purchase. QXL in the UK isn’t attractive but due to their expansion in territories eBay hasn’t conquered, along with it’s profitability, QLX does have a level of attractiveness.
3 Responses
I think he is wrong. This is purely my hunch, but I think that QXL is successful in a large part *because* of eBay rather than despite it. QXL like eBay are a survivor from the olden days before the dot com bubble burst. Looking at their traffic, it’s low in comparison, but very steady. To me, it looks like a group of dedicated users who are loyal to the site: QXL might have the dominant share of the market in most of those countries, but eBay still have a bigger worldwide presence: what better way for eastern European sellers to reach buyers in western Europe and the US? So if users are sticking with QXL, it’s because they like QXL. eBay muscling in, buying it and “eBayizing it” would, I think, most likely kill it.
You’ve got to ask whether Poland, Denmark, Norway and Switzerland (lovely as they all are) are worth cracking by buying QXL when you take into account that the company will cost somewhere close to £400m… that’s looks like nearly a billion bucks to an american.
I am getting good enquiries from Tazbar, Ebid and QXL now, only have a few items but they have all generated phone sales.
I hope Ebay leave QXL alone until they figure out what direction they want to take the Ebay business , auctions are dead in the water for me I get the impression they want to go back to the good old days of auctions but I am still baffled by the whole Express issue. Time will tell.