U.S.-based eBay Inc. has announced an agreement to by Giosis Pte. Ltd.’s. Japanese business, including the Qoo10 online shopping platform, in order to expand its presence in Asia's second-largest economy.
Giosis, which already counts eBay as an investor, operates seven localized online marketplaces in five countries including Japan and Singapore.
According to Devin Wenig, eBay's Chief Executive Officer, the company expects significant growth in Japan, which is the world's third-largest e-commerce market.
"There is this perfect convergence of growing wealth and technology adoption, and we think there's a lot of runway." Wenig said, "We're going to bring the world's inventory into Japan”
The deal mirrors eBay’s strategy in South Korea nearly one decade earlier, and will bring eBay's technology and its worldwide sellers to Qoo10’s base of 2 million shoppers.
Ebay has declined to disclose the terms of the deal, which a Bloomberg report valued at almost $700 million. As part of the deal terms, eBay will relinquish its stake in Giosis' non-Japanese businesses.
EBay has modified its platforms, including its namesake shopping service, to include grouped listings and a simpler payment process to lure shoppers amid stiff competition from Amazon.com Inc.
Recently eBay announced that it will drop PayPal as its payment service in 2023 in favor of Dutch technology company, Adyen. The company expects that it can bring more transactions in-house “Marketplace” platform and lower its costs compared to rivals such as Amazon. PayPal has been eBay’s partner for more than 15 years and generates 13% of its revenue from transactions on eBay.
Analysts believe that both eBay and PayPal will continue to grow after their split since both companies have strong brand recognition, deep data customer information and technology behind their services that will not be effected by changes in their partnerships.