he lockdown measures put in place throughout the world in response to the pandemic have led to a strong acceleration in e-commerce. One of the giants of online sales is eBay, a platform that functions as a marketplace between private or professional sellers and buyers.
The Silicon Valley company saw its annual turnover soar by 19% to $10.3 billion in 2020, and the total value of transactions carried out on its site increased by 17%, exceeding $100 billion for the first time. The strongest acceleration took place in the fourth quarter of 2020, with turnover up 28% and transactions up 21%. The annual number of active buyers increased by 7%, reaching 185 million users worldwide.
While pre-owned watches have been sold on eBay since the platform’s inception in 1995, at prices ranging from a few dollars to several hundred thousand dollars, last autumn the company launched its Authenticity Guarantee programme for luxury watches, in an attempt to act against counterfeiting and defects of all kinds. The company said it saw a double-digit gross-merchandise volume increase in luxury watches from the third to the fourth quarter.
In a fast-growing segment, eBay wants to take a share of online sales of luxury watches, which have been boosted by lockdown, and change its overall image.
Commenting on these results, CEO Jamie Iannone said that eBay “intends to try to keep expanding its customer base by focusing on Gen Z and millennial customers, as it did with sneakers and other categories.”
Tirath Kamdar, the newly installed head of luxury products on eBay, is a familiar face; we met him through the online watch sales platform True Facet. In a fast-growing segment, eBay wants to take a share of online luxury watch sales, and change its image from what may be perceived as grey market or cheap products to that of a respected platform for luxury goods. This giant step forward starts with the new authentication programme. We interviewed Kamdar to find out more.
Europa Star: What is your goal, in launching the new “Authenticity Guarantee” programme for watches on eBay?
Tirath Kamdar: Timepieces have been sold on eBay for 25 years now. With more than 165,000 listings posted on average every day, we are already one of the most important sales platforms in the watch market. But thanks to the Authenticity Guarantee programme launched last September for models worth more than $2,000, we are entering a new dimension. The aim is to offer buyers a better experience, by no longer having any doubts about the quality and authenticity of the watches they buy through eBay. We do not charge them anything for this service.
In concrete terms, how does it work?
Whether you’re a seller or a buyer, above $2,000, your timepiece is checked by a team of independent authenticators. eBay covers all the costs of the process, which includes checking dozens of inspection points, including the crown, bezel, dial, case, clasp/buckle, hands, links and serial number. Once its authenticity has been verified, each watch is provided with a unique authentication card containing detailed information. This is the first time that eBay has launched an authentication programme of this kind, and the watch segment has been chosen to pioneer it on our platform.
“This is the first time that eBay has launched an authentication programme of this kind, and the watch segment has been chosen to pioneer it on our platform.”
Who’s in charge of watch inspection?
We have entered into a partnership with a specialised company based in Ohio, which has been active for more than 35 years in the watch industry. We have also set up a team dedicated to watchmaking at our headquarters in California, with specific marketing investments. Our ambition goes beyond the authentication programme: for example, for the first time, we have launched an eBay account on Instagram dedicated to watches. In addition, secure payment through an escrow account is being introduced. We are trying to create a community. This is a complete paradigm shift for us.
Indeed, eBay doesn’t have the image of a luxury platform...
For historic platforms such as ours, this is a new challenge. And in order to achieve this, we must first remove any suspicion regarding the authenticity and quality of the products on offer. This is why the new service we offer is so important. We want to win the trust of customers for higher-value transactions. This is not only true for watches: the authentication service has since been extended to other categories such as trainers and luxury cars. The very good results achieved since last year, with double-digit growth for the luxury watch category, validates this strategy.
“We want to win the trust of customers for higher-value transactions. This is not only true for watches: the authentication service has since been extended to other categories such as trainers and luxury cars.”
Most of these platforms actually do have a sales space on eBay and are active on our platform. Given our large audience, which goes way beyond the “purists”, we have always been a growth accelerator for online sellers in any industry. The majority of timepieces offered on eBay come from specialist retailers and resellers. It’s a win-win situation.
Watch authentication has been introduced in the United States, your number one market. Are you going to extend it to other countries?
We have already started to implement authentication for watches arriving from abroad to consumers in the United States. You can now buy in the US from a Japanese seller with an authentication process. Eventually we plan to extend this service to consumers in other markets as well.
Has the pandemic crisis been a determining factor in your luxury “offensive”?
These expansion plans had already been put in place before the pandemic, but certainly, this period has greatly encouraged e-commerce, as our 2020 results clearly show. More generally, the online experience is changing. We have learned a lot, including how eBay can improve its services in such a situation.
What is your relationship with watch brands? We’ve recently seen many initiatives from them online, as well as takeovers of e-commerce platforms.
Brands are still trying to position themselves in the face of the rapidly emerging online second-hand market. Some are already in the process of entering this segment. It’s a market in full evolution. One thing I am sure of is that, although many brands are looking to China, the real new emerging market for watches is online sales in the United States. Watch brands should position themselves better in this niche.
“Although many brands are looking to China, the real new emerging market for watches is online sales in the United States.”
196,000 The number of watches priced above $2,000 sold on eBay, out of a total of over 597,000 watches sold over the last three years.
165,000 In 2020, the average number of daily live listings for luxury watches, which represents a 4% increase compared to 2019.
41% Rolex models as a proportion of the overall value of watch sales on eBay in 2020.