This ecommerce player is quietly beating Big Tech at its own game…
| From the desk of Miles Everson: Hello! I’m thrilled to talk about another interesting insight in the world of business for today’s “Return Driven Strategy (RDS).” For those of you who are not yet familiar with it, RDS is a pyramid-shaped framework with 11 tenets and 3 foundations. When applied properly, these principles help businesses attain high levels of performance. Today, we’re going to reveal how this 30-year-old e-commerce giant has quietly outpaced some of tech’s flashiest names! Curious? Continue reading below! |
This ecommerce player is quietly beating Big Tech at its own game… Tech juggernauts like Amazon and Microsoft have captured the market’s attention as they’ve brought in billions of dollars in revenue, thanks to their artificial intelligence (AI) and cloud computing offerings. While these industry giants are busy grabbing headlines, a 30-year-old e-commerce firm has quietly outperformed both… and the most surprising thing about this? This company has done that through its clever integration of AI into its operations! That’s why today, we’re going to talk about this e-commerce giant and reveal how its innovative approach to AI has made it an overlooked yet successful story!
Using AI to Turbocharge Operations eBay is one of e-commerce’s big players, yet when people encounter the name, they’d rarely associate it with AI. However, it’s precisely the latter that’s enabled it to outperform both Microsoft and Amazon. Microsoft’s stock is up 16% year to date while Amazon is only up 4%. eBay’s stock, on the other hand, is up a whopping 32% year to date… and instead of this surge being fueled by expanded operations or flashy deals, it’s primarily due to CEO Jamie Iannone’s decision to pair decades of proprietary data with cutting-edge AI tools. Before Iannone took over as CEO in 2020, eBay lagged behind Amazon. In the year prior, eBay’s revenue hovered around USD 7 billion, paling in comparison to Amazon’s USD 280 billion. Iannone worked at eBay from 2001 to 2009. Then, he went on to run Barnes & Noble ’s e-book business and later on, ran Walmart ’s e-commerce unit. Simply said, he was no stranger to the world of e-commerce. Once he was appointed CEO, he focused eBay’s attention back to some of its original strengths. For example, instead of trying to outgrow its competitors, eBay focused on used and refurbished items—a great market to be in especially when money is tight for consumers. By 2021, revenue had improved to around USD 10 billion. However, the real game-changer happened last year… when eBay made a big bet on AI. The company designed and deployed proprietary large language models (LLMs) that work well in tasks such as creating item descriptions and predicting prices. Similar tools were then given to sellers, helping them write product descriptions, set prices, automate replies to customer queries, and even create product listing images by making a few prompts. These additions made it easier to sell items. At present, all these tools have helped around 10 million sellers post over 200 million item listings. That’s not all. AI is also being used to identify product trends on social media—from vintage Oasis merchandise to clothing similar to Taylor Swift’s engagement dress. These tools have even been used to improve email campaigns, leading to 40% more engagement from customers. An Overlooked Success Story Seen Through the Lens of RDS As mentioned above, eBay’s clever utilization of AI has given it a significant boost, making it a case study on what real AI monetization could look like. However, beyond that, it tells something about high-performing companies… and it’s best explained through RDS’ fifth tenet: Innovate Offerings. In the book, “Driven,” Professor Joel Litman and Dr. Mark L. Frigo emphasized the importance of innovation. According to them, customer needs change over time and so do the methods needed to fulfill them adequately. That’s why rapid innovation is crucial, because offerings can quickly become obsolete. With AI rapidly reshaping how industries work, innovation activities can make or break a company. In eBay’s case, its shrewd use of AI has allowed it to boost its prospects significantly, even allowing it to outperform Big Tech giants. So, if you want an example on what AI monetization and innovation looks like, look no further than eBay! Its success story is a case study in how businesses can thrive in today’s AI-dominated landscape. — If you’re looking to gain a better understanding of Return Driven Strategy and Career Driven Strategy, we highly recommend checking out “Driven” by Professor Litman and Dr. Frigo. Click here to get your copy and learn how this framework can help you in your business strategies and ultimately, in ethically maximizing wealth for your firm. Hope you found this week’s insights interesting and helpful. Stay tuned for next Tuesday’s Return Driven Strategy! Have you ever walked into a room full of people talking and immediately knew who owns the conversation? Learn more about how this streaming platform is fulfilling customers’ entertainment needs in an era of streaming wars in next week’s article! |
Miles Everson
CEO of MBO Partners and former Global Advisory and Consulting CEO at PwC, Everson has worked with many of the world's largest and most prominent organizations, specializing in executive management. He helps companies balance growth, reduce risk, maximize return, and excel in strategic business priorities.
He is a sought-after public speaker and contributor and has been a case study for success from Harvard Business School.
Everson is a Certified Public Accountant, a member of the American Institute of Certified Public Accountants and Minnesota Society of Certified Public Accountants. He graduated from St. Cloud State University with a B.S. in Accounting.
