eBay Takes On Groupon Over Growing Market For Daily Deals

EBay Inc. will take on Groupon Inc. over the expanding market of customers looking for the daily deals offered by the nationwide site.

The news that eBay takes on Groupon came from Fox Business News, which noted that eBay unveiled a major re-design of its website including features made to look like Facebook. The new site is called eBay Lifestyle Deals, fashioned after Groupon’s daily deals, and is being offered in a limited number of urban areas including San Francisco and Washington, D.C.

As eBay takes on Groupon, it has also tapped into its own slate of deals. Ones being listed include $12 for a one-hour dog-walking service worth $25 and $110 worth of Yoga classes for $50.

“We have a big marketplace and a lot of people who come to eBay don’t just come for one thing – they stay and buy across categories,” said Devin Wenig, president of eBay Marketplaces. “It makes perfect sense to experiment with new categories, and services is one of these things. We’re seeing whether deals and services are attractive to our customers.”

It is not alone that eBay takes on Groupon. The company has teamed up with Signpost, a site that arranges deals with local merchants to go on eBay’s online marketplace. Though Signpost is a start-up, it has the backing of Google Ventures and also provides deals to Google Offers, another Groupon competitor.

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“Signpost is a merchant, just like merchants selling physical goods on eBay,” Wenig said. “A merchant may sell local or even global services on eBay in the future.”

As Reuters noted, the move is significant for eBay, which has traditionally focused on products rather than services.

EBay takes on Groupon at a potentially profitable time. BIA/Kelsey, a company that tracks the media industry, predicts that US consumer spending for online deals will grow to $5.5 billion by 2016, up from $1.8 billion last year.