EBay merchants also stand to gain, thanks to Yahoo's agreement to help eBay optimize its Web pages for the Yahoo search engine.
Yahoo says it will not artificially inflate eBay pages rankings, but it will work with eBay to improve the format of its pages
so that more eBay pages will appear on Yahoo search engine results. Hopefully for the merchants, those pages will also come
up more often and with better placement. Yahoo will also crawl eBay's Web site more frequently, and more automatic feeds will
be implemented from eBay to the Yahoo search index.
"Clearly, more and more customers begin their shopping experience online through a search, and eBay's moves to aggressively
position us as sellers within those search results is really critical," says David Yaskulka, founder and chief executive officer
of Blueberry Boutique, a shirt and tie seller on eBay. "This will be very positive for us as sellers."
Finally, their stated intention to develop and deploy pay-per-call advertising technologies is also smart. Yahoo stands to
benefit because this online ad format, which links potential buyers with advertisers via VOIP, is highly profitable. It commands
higher rates than pay-per-click because it more often leads to a purchase. On the other hand, eBay is very interested in enabling
this on its Web site, because it believes it will improve sales of big-ticket items, such as cars, Remek says, adding that
this was a primary motivation behind its acquisition of Skype last year.
"I'd be curious to see how a pay-per-call service will help with eBay's efforts to localize its eBay Motors service," said
Remek, referring to the company's development of what it calls eBay Motors 2.0, which will add a local search component to
eBay Motors' national marketplace.
As complementary as the partnership looks, its success isn't guaranteed. First, eBay and Yahoo remain competitors on several
fronts, such as comparison shopping, auctions and classified listings. Should their competition significantly heat up in any
of these areas, the partnership spirit could be threatened. Also, the partnership applies only to their U.S. operations.
Moreover, eBay has to be very careful how it displays the ads Yahoo will be providing, so that eBay merchants don't feel that
these ads are driving customers away from their listings and stores. "That needs to be done extremely carefully and delicately.
They need to show complementary products, as opposed to competing products," Weiner says.
Yaskulka isn't too worried. "We've seen some indication eBay is going to mitigate that risk for sellers," he says. "Based
on history, I wouldn't be surprised if eBay does something very smart there."
A final caveat is that the companies will now begin testing the technologies involved, so the fruits of the partnership are
unlikely to surface until next year, giving competitors a chance to react.