GSI Commerce shareholders are ecstatic. Their stock is worth 50% more than it was on Sunday.
From the release, the company states that the "acquisition enhances eBay’s position as the strategic global commerce partner of choice for retailers and brands of all sizes." In other words, anybody with a store front could be/should be an eBay customer. Amazon will surely continue to have something to say about this, let alone others such as Google which is just beginning to reveal its e-Commerce strategy.
Swirling with the acquisition is the all-important, first-party data that every e-Commerce site has if they choose to use it - everything from email addresses to browser cookies.
Though the transaction won't close till the third quarter of 2011, one can imagine that the technology and data strategies of the companies will begin to integrate immediately. This means that recent acquisitions by GSI Commerce such as Clearsaleing and Fetchback will begin pointing at larger eBay initiatives. The recent pullback from the intent data business makes even more sense today as the eCommerce giant looks to leverage its own data and capabilities across its entire eCommerce enterprise.
eBay spokesperson Johnna Hoff echoed the press release saying the following regarding the strategic implications of the acquisition:
- "Combined with eBay and PayPal, we believe GSI Commerce will enhance our position as the strategic global commerce partner of choice for retailers of all sizes.
- This transaction will introduce more than 180 GSI Commerce customers to eBay’s marketplace channel, and PayPal and BillMeLater will benefit from the opportunity to increase penetration with GSI’s customers online and off-line.
- GSI’s technology platform will benefit from leveraging eBay’s resources and innovation, augmented by a suite of eBay’s technologies such as Milo and RedLaser."
eMoney's Tricia Duryee breaks down the conference call (the link is here) with investors regarding the acquisition which revealed that GSI Commerce chief Michael Rubin will remain with a new spin-off as "EBay said it will divest GSI’s licensed sports merchandise business and 70 percent of ShopRunner and Rue La La. EBay will loan the holding company $467 million and retain a 30 percent stake in Rue La La and ShopRunner. In addition, Rubin will invest $31 million in cash." Read more on eMoney.
Finally, Citibank's Mark Mahaney offered strategic insights in a note to investors: "eBay’s Strategic Rationale Fairly Straightforward – GSI acquisition would provide Fulfillment and Logistics capabilities along with access to retailer relationships to eBay. As highlighted during the recent analyst day, eBay’s plan is to extend a broader range of products to its buyers and sellers. And GSI acquisition could allow eBay to provide fulfillment services to its Top Sellers as well as help existing GSIC customer to setup e-Stores on eBay.com as an alternative channel."
It's early days in the intent data business. If they can get their arms around it, eBay should have a powerful targeting tool on their eCommerce hands.
How about an eBay ad network/DSP buying retargeted impressions across the display ecosystem? Publishers could be a happy lot as eBay seeks its audience all over the Web.
By John Ebbert