Here’s How The Accelerated Mobile Pages (AMP) Technology Can Help eBay?

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Recently, eBay (NASDAQ:EBAY) announced that it has started using the Google-led open source Accelerated Mobile Pages (AMP) technology to improve the mobile browsing experience of its platform. While in early stages, the use of this technology has improved eBay’s mobile browsing speed significantly, As a result, the company is partnering with Google to launch a full-fledged e-commerce experience using  AMP. While the AMP technology is primarily used for news articles, adapting it for e-commerce will require several changes, such as adding smart buttons (e.g., “Add to Cart” and “Buy Now”). It will also require input elements such as search text boxes and advanced tracking. As eBay works towards creating a compelling browsing experience for its users, AMP technology looks promising as a way to create a faster e-commerce system. An increasing number of users prefer to use their mobile devices for e-commerce.  Accordingly, we believe eBay’s move to provide a fast, user-friendly mobile interface for its website will boost its revenues in the long term.

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Website Performance Is Critical For Customer Satisfaction

Speed plays a critical role for transactions on any e-commerce website. According to a surveys by Akamai and Gomez.com nearly 50% of web users expect a website to load in 2 seconds or less and tend to abandon a site which does not load within 3 seconds.  79% of users who have trouble with web site performance do not return to the website to buy again and 44% tell a friend about a poor shopping experience on the website. These results indicate the importance of speed for an e-commerce website and eBay’s efforts to experiment with new technologies to build a fast performing mobile website will ensure an enhanced user experience.  According to company management, eBay intends to deliver a differentiated shopping experience that enables buyers to find, compare and purchase items they need and clearly understand the unique value that eBay brings. A better browsing experience is one such area where the company is taking advantage of its structured data catalog to improve user experience.

A better and faster shopping experience can attract more users to eBay’s platform, which is a  key driver of its valuation.

A faster pace of increase in the number of users on eBay’s platform can lead to an upside in our price estimate.

We believe eBay is following a focused approach to attract more users to its platform and a fast browsing experience through the AMP technology will help the company move towards this goal. This investment towards an enhanced user experience should show results in terms of higher revenues over the long term.

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