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New angles for Ebay

Rob Hattrell, vice-president of Ebay UK, has aspirations for the site best known for selling second-hand goods by auction to become the “online Bicester Village” for fashion retailers and brands.

Drapers has to cancel the face-to-face meeting with Rob Hattrell, vice-president of Ebay UK, at its offices in Richmond, south London, scheduled just before the government lockdown was ordered on 23 March, and instead conduct the interview by phone. 

He had already sent the 200-plus staff to work from home, and he was about to do so himself, and spend the next six weeks housebound in Essex with his wife, Natalie, and four daughters.

With retailers’ and brands’ bricks-and-mortar stores closed for at least the next few weeks, consumers are dependent on online shopping channels, including those, such as Ebay, that serve as marketplaces for multiple brands.

Hattrell argues that Ebay, which started in San Jose, California, in 1995, was already an established force in the market: “If the name of the company has become a verb, you’re doing something right. I hear people on a daily basis saying they Ebay something.”

His ongoing challenge is to communicate that Ebay is more than an auction site for second-hand goods. The fact that 80% of purchases are of brand-new products makes it a credible outlet for fashion consumers, he says. Nevertheless, Hattrell may have his work cut out if he is to convince shoppers Ebay has the fashion credentials of an “online Bicester Village”.  

Hattrell joined Ebay in 2016 after seven years at Tesco, where he ran the non-food side of the business – “everything you can’t eat or wear”. Before that, he was a partner at consulting firm Accenture’s retail arm, where he advised brands including New Look, Gap and its sister brand, Banana Republic.

Hattrell replaced Tanya Lawler, who is now a non-executive director at companies including cosmetics retailer Space NK. Hattrell says that one of the reasons he joined Ebay is the “deep affection” that consumers hold for the brand, which he believes is “highly regarded and highly loved”.

The reality is that you can be more elastic with pricing online than in stores

Rob Hattrell

Ebay has 27 million UK shoppers – “more than half of the adult shopping population, and more than one per household” – and 5 million sellers worldwide. Of these, 300,000 are small and medium-sized businesses, which collectively list 1.3 billion items for 183 million buyers. 

It does not split out country-specific figures, but says that its fashion category, which includes new and used pieces, accounted for 20% of UK gross merchandise volume bought in 2019. In January, it reported that its overall global revenue for the fourth quarter of 2019 was down 2% in line with expectations to $2.8bn (£2.4bn), inclusive of its classified ad platform, and ticket-reselling site StubHub, which it owned at the time but sold to Viagogo this year for $4bn (£3.25bn).

Revenue of $10.8bn (£9.3bn) – up 1% – was at the top end of expectations. Fourth-quarter revenue without the additional platforms was $2.2bn (£1.78bn).

As well as its main auction platform, Ebay has more than 80 fashion labels in its “Brand Outlet” category in the UK, where brands ranging from British lifestyle retailer Joules to luxury labels such as Dolce & Gabbana sell directly through a “shop” to consumers at a discount of their choosing. New Look and Superdry are among the best-performing brands by sales volume, reports Ebay. They sell past-season stock at discounts of up to 70%. 

Joules (spring 20) is one of Ebay UK's top 10 bestselling fashion brands

Joules (spring 20) is one of Ebay UK’s top 10 bestselling fashion brands

Other top sellers include JD Sports Outlet, Office, Radley, TM Lewin, Jigsaw and Crew Clothing. Current-season items can also be listed in the fashion category’s “New In” page. The seller chooses whether to price these cheaper to Ebay’s 27 million shoppers than on its own website, and pays 10% commission. 

Mountain Warehouse is among Ebay UK’s 10 best-performing brands. Steven Wait, head of marketplaces at the outdoor specialist, says it has partnered with the platform since 2018 to “accelerate our sales growth, and increase brand presence in the UK and across our international markets”.

He adds that Mountain Warehouse has been able to “take advantage of on-site promotional positioning and cross-site coupon opportunities. Our account manager has been on hand to suggest new ideas, and help push our brand and products out to more customers.” This has led to “strong results”.

My vision is that in the long run we will be an online Bicester Village

Rob Hattrell

Hattrell argues that fashion brands are attracted to the platform as it offers them a trusted way to move past-season stock: “The truth is, we’re a value player. My vision is that in the long run we will be an online Bicester Village [designer outlet centre in Oxfordshire] – where, as a consumer, you can access the brands you love and trust, and we give retailers more control over their margins. Without being too crude, the reality is that you can be more elastic with pricing online than in stores.

“Having worked in fashion myself, I know there’s nothing more awkward than trying to work out how to trade last season’s stock. We give you that place – to get it out of the way and make room for great new product on the shop floor, giving you time to breathe.”

Footwear retailer Dune sells on Ebay. International ecommerce manager Molly Jones says the volume of product available on the platform makes “effective visibility very challenging”, but explains that Dune raises awareness through promotional strategies such as sponsored listings, which position the brand higher in search results, and brand events such as promotions. She adds that having an official shop on the platform gives shoppers “peace of mind” that they are not buying counterfeit goods.

Hattrell states that Ebay is dedicated to combatting counterfeiting: “We have a skilled team in Dublin, trained by brands to recognise fakes, along with sophisticated technology to weed out bad listings.” In 1998 it set up the Verified Rights Owner (VeRo) programme, which is accessible worldwide and can be used by all categories, including fashion brands, to simplify intellectual property claims.

Hattrell alludes to plans to grow the brand outlet “later this year” but will not reveal details.

Dune has observed the developments within its fashion arm and is exploring opportunities of selling full-price on Ebay, Jones adds: “As Ebay continues to drive awareness of fashion as a category and focuses on transitioning from being known within the household as an auction or discount channel to that of a new-season full-price destination, we are exploring new opportunities outside of off-price.”

dune spring 20

Footwear retailer Dune sells on Ebay

Ebay needs to raise awareness that it sells these major brands, believes Emily Salter, retail analyst at GlobalData: “I wouldn’t have known that the likes of Joules and Superdry sell on Ebay. It is better known for the resale of electrical items, and would need to replicate that reputation in fashion.” 

Ebay needs to improve its shopping journey, she argues, as outside the Brand Outlet channel – which displays retailers’ discounted product – the images used by sellers are not of professional quality. 

She also suggests the Ebay website could replicate its app’s image-search function, and make “better use of personalisation” in its search function: “The homepage adapts to what you’ve searched for before.”

Ebay has become a key trading channel and we look forward to further building on our partnership

Ralph Percival, Joules

One ecommerce expert asserts that Ebay’s fashion category is not visually inspiring enough: “Other retailers are spending more on making it a magazine-like experience. I don’t see any of that in Ebay. The technology that drove it hasn’t been matched with something creative.”

Nevertheless, Ralph Percival, ecommerce director of Joules, says its partnership with the platform has been going from “strength to strength”: “Ebay has become a key trading channel and through international expansion, strategic trading initiatives, strong product selections and key marketing placements, we look forward to further building on our already successful partnership.”

Hattrell says: “We don’t buy stock. We don’t compete. Our job is basically to give brands the best platform we can to present the things that they want to sell. That’s not corporate ‘you-know-what’. That’s our business model.” He says he is fiercely protective of Ebay’s sellers: “Unlike some other people that you may think are relevant in this space, we only exist because we partner with our brands.” And that is why, unlike rival marketplace Amazon, Ebay has no plans to launch its own fashion label. Amazon has more than 30 in-house brands, including womenswear label Find, which launched in 2017.

Rob Hattrell opened an Ebay pop-up shop Wolverhampton in May last year

Rob Hattrell opened an Ebay pop-up shop Wolverhampton in May last year

“Our message is very simple and singular: our job is to connect the buyer and seller, and we only succeed when the sellers succeed,” says Hattrell. “We will never compete with our sellers. It’s not in our DNA – there are other people who do that. We are extremely principled: our business model is not to encroach on what our sellers do. The reason people go to Ebay is for well-known brands and good prices.”

Nevertheless – and the coronavirus shutdown notwithstanding – Ebay does have other retail ambitions, and these extend to bricks and mortar. In May 2019 the etailer opened a pop-up shop in Wolverhampton, selling the wares of 60 local businesses – from a bag brand to homeware, and pet supplies – that had no online presence. It took them under its digital wing by training them in trading on Ebay and taught them how to run a digital business. 

Ebay says those retailers recorded sales growth of 33%, and 58% had to hire more staff. The coronavirus pandemic has “put a pin” in the project – although Hattrell says to “watch this space”, as Ebay plans to continue the mentoring in new ways.

He adds: “The articulation in the retail industry that there’s a zero-sum game between online and offline retail is wrong – it suggests that one wins out and one disappears. I don’t think that’s right. Consumers will always want to physically experience shopping – notwithstanding our current situation [the coronavirus pandemic].”

Hattrell says that “like for everyone, life is extremely uncertain” for Ebay amid the crisis and the platform’s first priority has been the well-being of its staff, and helping its small businesses and sellers. Logistics and shipments to consumers were running as usual at the time of writing. Nevertheless, Hattrell recognises the impact the virus will have on Ebay’s sellers, especially small businesses, and is positive about chancellor Rishi Sunak’s £330bn loan scheme, calling it “great steps that start to help”.

In mid-March, Ebay announced that any new business would not have to pay selling fees until 31 May 2020 and existing sellers were given a 30-day “payment holiday” to pay for listing and selling fees. An extension to the time period is to be considered at the end of April.

Ebay research found that 70% of UK shoppers are interested in shopping sustainably, and the retailer say it is the right place to do so, as it lists 27 million second-hand fashion items at any one time. At the beginning of March, it launched a “Vintage Hub”, where users have the option of browsing by decade.

Hattrell says Ebay believes “the high street versus the internet doesn’t exist, they actually go hand in glove”, and believes online and offline stores can work together: “There are sellers on the platform who started businesses online who have gone on to open shops after building cashflow.”

In the current climate, however, bricks-and-mortar stores are suffering more than ever. Hattrell tells Drapers that more than half of its fashion sellers have a physical store, and Ebay is supporting them as they focus on online sales. 

One of Ebay’s strengths is its reputation for selling second-hand fashion. Sustainability is currently on trend and buying pre-worn clothing helps shoppers to lower their environmental footprint. The number of used clothing items sold on Ebay, rose by one-third in 2019 and the site now sells one piece every five seconds.

Hattrell says, “given our history and our heritage it’s a sweet spot for us”, and tells Drapers that in 2019, 18 million people in the UK bought a piece of used clothing from Ebay.

Ebay research found that 70% of UK shoppers are interested in shopping sustainably, and the retailer say it is the right place to do so, as it lists 27 million second-hand fashion items at any one time. At the beginning of March, it launched a “Vintage Hub,” where users have the option of browsing by decade.

Hattrell continues that he doesn’t believe that the platform has any “direct competitors in this space” and that Ebay remains unique in its support of small businesses, value and choice for the consumer that is “increasingly thoughtful about the environmental footprint they leave”. 

Hattrell notes that price gouging, when the prices of in-demand products are inflated, has been an issue for Ebay’s general listings amid the coronavirus outbreak. It has been criticised for not addressing this quickly enough, but measures have been implemented as of the end of March “only verified sellers are able to sell products such as antibacterial gel, protective masks, toilet roll, and baby formula,” and Hattrell reports that Ebay has removed “nearly half a million” items relating to Covid-19, and suspended multiple accounts.

Ebay is a digital heavyweight that wants to nurture small businesses instead of taking them on at their own game – from refusing to rival its sellers to giving the high street a helping hand. It is quite content to be known for its bargain buys and does not have high fashion in its sights, although it might have to up its offer, and awareness of its fashion categories, if it wants the verb “Ebay it” to be synonymous with shopping for fashion. 

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