eBay have announced that they have changed their definition of Gross Merchandise Volume (GMV) to align with customer money flows on their platforms.
“GMV provides a useful measure of the overall transaction volume on eBay’s platforms and is correlated to net transaction revenue. The Company has updated its definition of GMV to include all paid transactions on its platforms inclusive of shipping fees and taxes. Previously, eBay reported GMV regardless of whether the buyer and seller actually consummated the transaction. This change has been enabled by the increased visibility derived from the Company’s transition to managing payments globally.”
There are two interesting points to note, both of which will have no impact on your business, this change is more interesting to investors than to sellers.
Firstly, GMV includes not just the item value but also all shipping fees and taxes – this makes sense as eBay has since 2011 charge fees o shipping as well as the item price.
The second interesting snippet is that eBay have previously included unpaid items in their GMV reporting, although this will be no longer the case. It’s a small change as, however annoying an unpaid item might be, eBay have reduced this problem drastically in recent years by forcing buyers to pay in most cases before the transaction is completed. There are no where near as many unpaid items on eBay today as there might have been many years in the past.
eBay say that the updated GMV definition has an immaterial impact on previously reported GMV. They have also restated historical metrics, including GMV and active buyers, which can be found on the Investor Relations section of ebayinc.com. GMV under this new definition does not materially change guidance issued by the Company on the 27th of October 2021.