eBay Inc (NASDAQ:EBAY) made its name as the world’s largest online auction by connecting buyers and sellers of secondhand items all over the world for the first time ever. However, in today’s day and age, that is not nearly enough to keep a multinational company afloat, and EBAY stock has felt the sting as other e-retailers began to encroach on its territory.
The firm has seen only modest revenue growth in recent quarters and many have begun to look critically at the site’s future.
To counter this, eBay has rolled out a new data strategy that is intended to improve the user experience on the site by ramping up EBAY’s data collection and processing methods.
The new strategy is expected to make eBay easier to use and give customers better search results, product recommendations and alternate shopping options.
This is one of the many things that companies like Amazon.com, Inc. (NASDAQ:AMZN) have done to set its site apart from rivals. When people search for things on Amazon, the e-retailer uses its massive database to show shoppers what items people bought after viewing a particular product, the highest rated version of that product and related product options.
EBAY Stock’s Corrigon Acquisition
In keeping with this new data strategy, eBay announced that it plans to acquire a small visual technology company based in Israel called Corrigon.
Corrigon specializes in visual search technology that allows computers to recognize objects and text within pictures and correctly classify them. This is a huge step forward for eBay, as buyers rely on pictures of the items they are purchasing to give them an idea of quality, authenticity and wear-and-tear.
Since images make up such a huge part of eBay’s overall sales structure, Corrigon will be a major asset to the firm.
Streamlining eBay’s Database
Corrigon is not the first tech startup that eBay has acquired as part of its structured data initiative — the firm also picked up SalesPredict and Expertmaker in May. However the Corrigon acquisition is a big one, as the firm’s image recognition technology is expected to help eBay clean up its massive product database.
The firm claims to have some 1 billion product listings — which is an impressive figure, but hard to manage because the sellers themselves set the listings up. This structure, in which sellers are responsible for categorizing and organizing their own products, can be cumbersome since there is some room for error as to where a product comes up in a search and whether or not it is classified correctly.
With Corrigon on board, eBay will be able to sift through its volumes of images and link together products that may be of interest to particular shoppers and offer them as alternatives.
The Bottom Line
While Corrigon is not a golden key for EBAY stock, it certainly is a step in the right direction. The technology that the tech start-up brings to the table fits perfectly in-line with eBay’s initiatives and will give the firm the structure and organization it needs to give customers a better shopping experience.
As of this writing, Laura Hoy did not hold a position in any of the aforementioned securities.
