It’s been a strong year for eBay (NASDAQ:EBAY), with the shares up almost 47% since Jan. 1. The company continues to get traction with PayPal as well as its mobile business. But eBay wants to expand the market opportunity even more — by allowing teens to open up accounts.
The company will need to be careful, though. Not only are there stringent privacy laws, but eBay could stir-up a backlash.
As a result, it looks like eBay has been focusing on putting lots of restrictions on its new system, which is expected to launch within about nine months. A key will be encouraging parental involvement.
There are some key advantages for targeting the teen demographic. They have lots of purchasing power and like to shop. What’s more, they are at a point when they start to become loyal to brands.
So while there are risks for eBay, the potential benefits are worth giving the new plan a try.
– Tom Taulli, InvestorPlace