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Business News/ Companies / ‘India a priority market for eBay’

‘India a priority market for eBay’

  • In an interview, Vidmay Naini, eBay’s general manager for global emerging markets, which include India and Southeast Asia, spoke about the challenges faced by India’s e-commerce exporters and the role of generative artificial intelligence (AI) in e-commerce ventures

EBay, an online marketplace for buyers and sellers, generates 50% of its revenue from markets outside the US. (Photo: Company website)

NEW DELHI :EBay, an online marketplace for buyers and sellers, generates 50% of its revenue from markets outside the US. India, which is classified under emerging markets, has remained an important market for eBay despite the company exiting the market in 2017. In an interview, Vidmay Naini, eBay’s general manager for global emerging markets, which include India and Southeast Asia, spoke about the challenges faced by India’s e-commerce exporters and the role of generative artificial intelligence (AI) in e-commerce ventures. Edited excerpts:

EBay, an online marketplace for buyers and sellers, generates 50% of its revenue from markets outside the US. India, which is classified under emerging markets, has remained an important market for eBay despite the company exiting the market in 2017. In an interview, Vidmay Naini, eBay’s general manager for global emerging markets, which include India and Southeast Asia, spoke about the challenges faced by India’s e-commerce exporters and the role of generative artificial intelligence (AI) in e-commerce ventures. Edited excerpts:

How significant is the Indian market to eBay?

Often, there is a lot of baggage to the eBay narrative. We do not operate in the domestic market at this point in time—in 2017, we exited the domestic market in India and sold our India business to Flipkart. So, starting in 2018, one of our consistent strategies has been to focus on business-to-consumer (B2C) exports.

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How significant is the Indian market to eBay?

Often, there is a lot of baggage to the eBay narrative. We do not operate in the domestic market at this point in time—in 2017, we exited the domestic market in India and sold our India business to Flipkart. So, starting in 2018, one of our consistent strategies has been to focus on business-to-consumer (B2C) exports.

This essentially entails Indian sellers selling (products) to the world. We’ve been enabling this for more than a decade, where we’ve enabled Indian sellers to sell to our co-sites in the US, the UK, Germany and mainland Europe.

This has been our focus in India since 2018, and we’ve had a robust, scalable and strong business emerging out of here. India is one of our priority markets and is definitely among the top five of 180 countries under eBay’s emerging markets division.

Is India supportive of export-driven e-commerce operations?

‘Exports’ has become a buzzword in the past couple of years. We have been in this business for the past 10 years. Through my time, we’ve seen plenty of challenges in foreign trade and exports in India—be it procedural or otherwise. Most of them, at a policy level, have been solved to a large extent in the past four to five years. Now, with the new Foreign Trade Policy coming in, there’s a strong recognition that e-commerce exports are one of the growth drivers for our economy as well.

Today, you hear a lot more people from the government with their target of $2 trillion in exports by 2030. This implies a lot of activities starting up—we, meanwhile, have been at it for the past decade.

How much does eBay contribute to India’s e-commerce export target?

We do not disclose individual country-wise numbers. But, we are a significantly large business. As context, we will be within the top five e-commerce companies in India, including all entities.

What kind of operations does eBay run in India?

We do have an analytics centre in Bengaluru. But our primary focus for business operations remains only on enabling B2C exports. We’ve been working with various stakeholders for this—the government, the Directorate General of Foreign Trade (DGFT) and various other members.

Are India’s policies conducive to e-commerce exports?

Most export-related policies are related to offline exports. Online exports were a challenge in their very style, be it with the claiming of MEIS (Merchandise Exports from India Scheme) benefits, claiming GST (Goods and Services Tax) refunds for e-commerce exports, remittance costs and multiple other such issues. Other issues included the process of export documentation, limits per consignment (which have been increased to 10 lakh now), allowing jewellery through courier services and the overall documentation procedures. Some of these things have changed.

Earlier, you had to print nearly nine pages of documentation to ship a single product, the value of which could have been a mere $10. The cost of operations was very high as a result, which has been reduced now, with digitized CSV files coming in a couple of years ago.

If you look at the process of exports, it has eased up. But are we there in terms of the full ease of doing business? Not yet, honestly—in the large region that I handle for eBay, when I look at other countries that compete with Indian sellers, they have a much easier way to export. The good part is that the government is aware of it. They understand the issues that we face. They have simplified some of it, but there’s a long way to go.

I feel that the $2 trillion e-commerce export economy contribution by 2030 is achievable, which will bring the sector’s contribution up to 8-10% of our overall exports. But to achieve this, numerous other processes and policies need to be simplified, and this factor is recognized by the government at the highest level.

Why did eBay decide to exit India in 2017?

From a strategy point of view, we need to be very clear in terms of where our right to win is, how much investment we need to put in place and the markets we need to tap into.

I don’t have to give out the financial numbers of other domestic e-commerce players—their operating ratios and cash burn are out there. We were quite clear in terms of how we could build a long-term, sustainable business—eBay’s probably the only (e-commerce) company that made significant money in India. We gained a lot from the Flipkart investments and also from various other investments we made.

So, from a strategic point of view, we’ve taken a call that e-commerce exports are a space that is going to grow. This is a larger piece of the overall business that we can compete in and win, and do so in a profitable, scalable and sustainable way.

What kind of work happens out of your Bengaluru centre, and how does eBay use AI?

It is a Centre of Excellence (CoE) in analytics, where we have technical development work happening for every side of the business. We have teams working on all of our global markets. It is a large and sizeable operation where we have in-house teams building tech capabilities for our global operations. While we do not have a headcount to disclose, our CoE employee base is on par with our export operations team, both of which are fairly large.

As far as technology is concerned, I think e-commerce is not as simple as it used to be earlier. Right now, most of us, including our sellers, adopt technologies—be it artificial intelligence and machine learning (ML), as well as the recent generative AI buzzword. We have most of these technologies that factor into our business plans in various ways, with various tools based on these technologies being used by our sellers—and by eBay itself.

Fundamentally, e-commerce is a simple operation where you move one product from point A to point B. This process involves various aspects—the platform needs to be intuitive and generative in terms of its demand-supply equation.

Today, we have close to 1.6 billion product listings on our site globally. We have more than 132 million buyers and millions of sellers as well. We operate at a massive scale that is larger than what is seen in the Indian e-commerce industry. For us, aspects including platform, stability, security, ubiquity and findability have various technologies being deployed, which include the latest standards of AI and ML algorithms as required.

Since we touched upon generative AI, how does this impact an e-commerce business?

For any e-commerce business, at the fundamental content creation level, when you list products, you require a lot of content to go up. Generative AI is a big tool and an aid—where it’ll help you create content for your listing, create catalogues, help improve product descriptions and narratives, and it will help you search better and make product searches simpler.

Some of our sellers are already seeing significant benefits from it—be it in terms of cost saving and improvement in conversion rates. But all of us are learning right now. It is still an early phase for us to understand the tech fully.

Would ONDC (Open Network for Digital Commerce) have an impact on eBay’s India business?

ONDC is primarily focused on the domestic market, at least for the time being. Our view is very limited as a result—we can talk about it if there are discussions on Indian exports being pushed through ONDC. But, before that, the regular export framework should be cleaned up first—before we get into a much more complicated, layered approach.

It’s also important to note that the DGFT is working towards easing some of the online export regulations. Our first priority in such a simplified regime would be to ease the procedures for regular e-commerce exports and then work towards aggregated marketplace approaches.

Looking at the verification and security of product listing, how big a challenge is it operationally and in terms of cost—and does tech help in this process?

So, eBay is an open marketplace platform, and we have various trust initiatives. Ultimately, it is this trust based on which cross-border e-commerce transactions happen. Fundamentally, we have eBay buyer protection and seller protection programmes. We also have robust, complex AI and ML models in our back end, which analyse the data and show who’s a trusted seller and who isn’t. These add inputs to our overall visibility of trust on our platform.

In the past couple of years, we’ve also launched an authenticity guarantee programme. For example, in jewellery—the largest product category for eBay in India—any jewellery that we sell at above $500 globally, all of that is certified by the Gemological Institute of America. The product goes in only once it is certified, which helps us increase trust factors. We offer such certifications across handbags, sneakers, luxury watches and other collectables, too.

There are also local India-level programmes. We have a global expansion programme under which most sellers on eBay are vetted.

ABOUT THE AUTHOR

Shouvik Das

Shouvik Das is a science, space and technology reporter for Mint and TechCircle. In his previous stints, he worked at publications such as CNN-News18 and Outlook Business. He has also reported on consumer technology and the automobile sector.
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