As part of initiatives to get rid of its image as a older, disorganized online marketplace, eBay Inc. (NASDAQ:EBAY) unveiled a new logo late last week. The company explains that the new logo reflects the ‘global online marketplace that offers a cleaner, more contemporary and consistent experience’ it has evolved into since starting as an online buy-and-sell business 17 years ago. The new logo retains the primary colors and features letters that are thinner and arranged in a line compared to the previous logo which had a bigger font with overlapping jumbled letters at varying heights. The new logo is expected to go live mid-October and will appear on the company’s websites, advertising and marketing campaigns. We believe that the new logo along with recent updates highlight eBay’s attempt to refresh its image as an antiquated, auction-only website and to win back online business that has shifted to Amazon.
Can a new logo attract new customers?
In the past, users had often complained of the inefficiency inherent in shopping at eBay Marketplace as they spent the majority of their time browsing through the collection. While the process facilitated the discovery of other items a user may be interested in buying, it was a frustrating experience for them. However, as an increasing number of items sold on eBay these days are listed at a fixed ‘Buy it Now!’ price, the company initiated features to facilitate discovery and search of other items. It acquired two companies, Hunch and Svpply, which design suggestion features that aid visual and comparative search by tapping into the social connections of the users. These features have a significant impact on the time users spend making a purchase versus only browsing through the collection.
We think that the new logo is an attempt by the company to project itself as an organized marketplace with a seamless experience. Combined, the features and the new logo carry across the message that eBay is now an ordered marketplace and a viable alternative to Amazon.com, which has been growing at a faster pace. We expect the number of users of eBay and its services to increase, bringing in more revenues, as it debunks its old image.
We currently have a $50 estimate for eBay, which is in-line with the current market price.