eBay Hopes Shoppers Will Cash In On eBay Bucks

2.2 billion dollars in revenue and 11 percent growth seem like strong earnings. That is, unless your eBay. The strength of eBay’s Q2 earnings, driven mostly by PayPal, were undermined as eBay cut its fiscal forecast by $250 million. Such earnings adjustments are enough to make $20 million in fraudulent affiliate commissions seem like a small matter.

Due to Amazon’s growing strength and marketplace shifts, eBay’s market relevancy has slipped over the years. They just seem to be out of mind. As consumers adopt social media, eBay has become less exciting.

So how do you bring the excitement back? eBay hopes money will help.

Resorting to bribes, eBay has launched eBay Bucks a loyalty program that will offer consumers 2 percent back on items purchased on the site through PayPal. Once the Bucks are rewarded, consumers can use them towards additional eBay purchases. The program excludes all purchases from Business & Industrial Capital Equipment, Real Estate, and eBay Motors categories.

Loyalty programs are historically healthy models with companies as large of Discover using them to great success. Although the model is proven, success is often dependent on how well consumers click with the company itself. Microsoft Bing’s shuttering of their cashback program is a clear example of what happens when a program doesn’t click.

Interestingly, one of the primary methods people did use Bing’s Cashback was on eBay. How this bodes for eBay’s program remains to be seen.

As a side note, eBay implementing such a loyalty program may have an impact on affiliate relationships especially those in the loyalty space. Will consumers get to double-dip on awards from eBay and its affiliates? Will eBay count sales referred by an affiliate if the consumer was previously enrolled in eBay Bucks? It will interesting to whether eBay will play fair with its own affiliates.