EBAY » Topics » Sales and Marketing

This excerpt taken from the EBAY 10-K filed Feb 17, 2010.

Sales and Marketing

 

     2007     2008     2009  
     (In thousands, except percentages)  

Sales and marketing

   $ 1,882,810      $ 1,881,551      $ 1,885,677   

As a percentage of net revenues

     24.5     22.0     21.6

Sales and marketing expenses consist primarily of advertising costs, marketing programs, employee compensation, facilities costs and depreciation on equipment.

Sales and marketing expense increased by $4.1 million in 2009 compared to 2008, due primarily to the inclusion of costs attributable to Gmarket (acquired June 2009), Bill Me Later (acquired November 2008) and Den Blå Avis and BilBasen (acquired October 2008) of $97.6 million as well as an increases in employee related expenses of $23.7 million and professional services costs of $10.2 million. The increases were partially offset by a $126.6 million reduction in marketing programs as we continue to focus on customer retention (for which certain associated expenses are recorded as a reduction in revenue instead of sales and marketing expense) rather than customer acquisition.

Sales and marketing expenses decreased by $1.3 million in 2008 compared to 2007. We increased the use of buyer and seller incentive programs (for which certain associated expenses are recorded as a reduction in revenue instead of sales and marketing expense) as opposed to online and offline marketing programs as we shifted our marketing focus from customer acquisition to customer retention. Marketing and advertising program costs decreased approximately $100.4 million partially offset by an $87.7 million increase in employee-related costs due to a net increase in staffing.

Sales and marketing expense as a percentage of net revenues decreased in 2009 and 2008 due to lower, more targeted spending within our Marketplaces segment as well as the growth of our Payments and our former Communications segments, each of which has lower relative sales and marketing expenses than our Marketplaces segment.

This excerpt taken from the EBAY 10-Q filed Apr 28, 2009.

Sales and Marketing

 

     Three Months Ended  
     March 31, 2008     March 31, 2009  
     (In thousands, except percentages)  

Sales and marketing

   $ 514,554     $ 403,316  

As a percentage of net revenues

     23.5 %     20.0 %

Sales and marketing expenses consist primarily of advertising costs, marketing programs and employee compensation for sales and marketing staff.

The decrease in sales and marketing expenses in the first quarter of 2009 of $111.2 million, or 22%, compared to the same period of the prior year, was due primarily to a decline in marketing and advertising program costs. During the first quarter of 2009, marketing expenses were lower primarily due to reduced marketing spend and a shift in focus from customer acquisition to customer retention (for which certain associated expenses are recorded as a reduction in revenue instead of sales and marketing expense). Sales and marketing expense as a percentage of net revenues during the first quarter of 2009 decreased from the same period of the prior year due to lower, more efficient spending within our Marketplaces segment as well as the growth of our Payments and Communications segments, each of which has a lower relative sales and marketing expenses than our Marketplaces segment.

These excerpts taken from the EBAY 10-K filed Feb 20, 2009.
Sales and Marketing
 
                         
    2006     2007     2008  
    (in thousands, except percentages)  
 
Sales and marketing
  $ 1,587,133     $ 1,882,810     $ 1,881,551  
As a percentage of net revenues
    26.6 %     24.5 %     22.0 %
 
Sales and marketing expenses consist primarily of advertising costs, marketing programs and employee compensation for sales and marketing staff.
 
Sales and marketing expenses decreased $1.3 million in 2008 compared to 2007 as we increased the use of buyer and seller incentive programs (for which certain associated expenses are recorded as a reduction in revenue instead of sales and marketing expense) as opposed to online and offline marketing programs as we shifted our marketing focus from customer acquisition to customer retention. Marketing and advertising program costs decreased approximately $100.4 million partially offset by an $87.7 million increase in employee-related costs due to a net increase in staffing. Our marketing expenses are largely variable, based on growth in revenue and changes in advertising rates. Sales and marketing expense as a percentage of net revenues decreased from 2007, due to more efficient spending within our Marketplaces segment as we shifted the focus of our marketing programs, as well as the growth of our Payments and Communications segments, each of which has a lower relative sales and marketing expenses than our Marketplaces segment.
 
Sales and marketing expenses increased $295.7 million, or 19%, in 2007 compared to 2006, due to our continued investment in retaining and growing our active user base. We direct customers to our websites primarily through a number of online marketing channels such as sponsored search, portal advertising, email campaigns and other initiatives. Growth in advertising and marketing costs, as well as employee-related costs, comprised the majority of the increases. Combined advertising and marketing costs increased $222.5 million due to an increase in global television and online marketing campaigns. Employee-related costs and the use of contractors increased by $48.7 million as we continued to expand our domestic and international operations. Sales and marketing expense as a percentage of net revenues decreased from 2006, due to more efficient spending within our Marketplaces segment as we continued to refine our marketing programs and to the growth of our Payments and Communications segments, each of which has lower relative sales and marketing expenses than our Marketplaces segment.
 
Sales
and Marketing



 







































































                         

 

 

2006

 

 

2007

 

 

2008

 

 

 

(in thousands, except percentages)

 
 


Sales and marketing


 

$

1,587,133

 

 

$

1,882,810

 

 

$

1,881,551

 


As a percentage of net revenues


 

 

26.6

%

 

 

24.5

%

 

 

22.0

%






 



Sales and marketing expenses consist primarily of advertising
costs, marketing programs and employee compensation for sales
and marketing staff.


 



Sales and marketing expenses decreased $1.3 million in 2008
compared to 2007 as we increased the use of buyer and seller
incentive programs (for which certain associated expenses are
recorded as a reduction in revenue instead of sales and
marketing expense) as opposed to online and offline marketing
programs as we shifted our marketing focus from customer
acquisition to customer retention. Marketing and advertising
program costs decreased approximately $100.4 million
partially offset by an $87.7 million increase in
employee-related costs due to a net increase in staffing. Our
marketing expenses are largely variable, based on growth in
revenue and changes in advertising rates. Sales and marketing
expense as a percentage of net revenues decreased from 2007, due
to more efficient spending within our Marketplaces segment as we
shifted the focus of our marketing programs, as well as the
growth of our Payments and Communications segments, each of
which has a lower relative sales and marketing expenses than our
Marketplaces segment.


 



Sales and marketing expenses increased $295.7 million, or
19%, in 2007 compared to 2006, due to our continued investment
in retaining and growing our active user base. We direct
customers to our websites primarily through a number of online
marketing channels such as sponsored search, portal advertising,
email campaigns and other initiatives. Growth in advertising and
marketing costs, as well as employee-related costs, comprised
the majority of the increases. Combined advertising and
marketing costs increased $222.5 million due to an increase
in global television and online marketing campaigns.
Employee-related costs and the use of contractors increased by
$48.7 million as we continued to expand our domestic and
international operations. Sales and marketing expense as a
percentage of net revenues decreased from 2006, due to more
efficient spending within our Marketplaces segment as we
continued to refine our marketing programs and to the growth of
our Payments and Communications segments, each of which has
lower relative sales and marketing expenses than our
Marketplaces segment.


 




This excerpt taken from the EBAY 10-Q filed Oct 23, 2008.
Sales and Marketing
 
                                                 
    Three Months Ended           Nine Months Ended        
    September 30,
    September 30,
    Percent
    September 30,
    September 30,
    Percent
 
    2007     2008     Change     2007     2008     Change  
    (In thousands, except percentages)  
 
Sales and marketing
  $ 485,240     $ 457,216       (6 )%   $ 1,406,260     $ 1,497,181       6 %
As a percentage of net revenues
    25.7 %     21.6 %             25.6 %     23.0 %        
 
Sales and marketing expense consists primarily of advertising costs, marketing programs, contractor costs and employee compensation for sales and marketing staff.
 
Sales and marketing expense decreased in the third quarter of 2008 by $28.0 million, compared to the same period in the prior year. Sales and marketing expense increased in the first nine months of 2008 by $90.9 million, compared to the same period in the prior year. Employee-related costs, including the use of contractors, facilities and equipment, increased $26.4 million and $90.8 million in the third quarter and first nine months of 2008, respectively, compared to the same periods in the prior year due primarily to an increase in staffing. We direct customers to our websites primarily through a number of online marketing channels such as sponsored search, portal advertising, email campaigns and other initiatives. Combined advertising and marketing costs decreased $50.3 million and $14.0 million during the third quarter and first nine months of 2008 compared to the same periods in the prior year. Advertising and marketing costs are decreasing as a percentage of net revenues as we increase the use of buyer and seller incentives (for which certain associated expenses are recorded as contra-revenue instead of sales and marketing expense) as opposed to online and offline marketing programs in an effort to improve user loyalty and retention, as well as to more efficiently incur marketing expenditures by our Marketplaces segment.
 
For the remainder of 2008, compared to the same period in 2007, we expect sales and marketing expense to decrease in total and as a percentage of revenues due to improved sales and marketing expense leverage in our Marketplaces segment, the relative growth in our Payments and Communications segments (each of which generally has lower relative sales and marketing expense as a percentage of net revenues than our Marketplaces segment), and our increased use of buyer and seller incentives (for which certain associated expenses are recorded as contra-revenue instead of sales and marketing expense).
 
This excerpt taken from the EBAY 10-Q filed Jul 24, 2008.
Sales and Marketing
 
                                                 
    Three Months Ended       Six Months Ended    
    June 30,
  June 30,
  Percent
  June 30,
  June 30,
  Percent
    2007   2008   Change   2007   2008   Change
    (In thousands, except percentages)
 
Sales and marketing
  $ 477,768     $ 512,787       7 %   $ 921,020     $ 1,039,965       13 %
As a percentage of net revenues
    26.0 %     23.4 %             25.6 %     23.7 %        
 
Sales and marketing expense consists primarily of advertising costs, marketing programs, contractor costs and employee compensation for sales and marketing staff.
 
Sales and marketing expense increased in the second quarter and first six months of 2008 by $35.0 million and $118.9 million, respectively, compared to the same periods in the prior year. Employee related costs, including the use of contractors, facilities and equipment, increased $28.1 million and $64.4 million in the second quarter and first six months of 2008, respectively, compared to the same periods in the prior year due primarily to an increase in staffing. We direct customers to our websites primarily through a number of online marketing channels such as sponsored search, portal advertising, email campaigns and other initiatives. Combined advertising and marketing costs decreased $3.1 million during the second quarter of 2008 compared to the same period in the prior year. Combined advertising and marketing costs increased $36.3 million in the first six months of 2008 compared to the same period in the prior year. Advertising and marketing costs are decreasing as a percentage of net revenues as we increase the use of buyer and seller incentives (for which certain associated expenses are recorded as contra-revenue instead of sales and marketing expense) as opposed to online and offline marketing programs in an effort to improve user loyalty and retention, as well as more efficient marketing spend by our Marketplaces segment.
 
Sales and marketing expense in 2008, compared to 2007, is expected to increase in total due to an expected increase in our marketing activities to retain existing users and attract new customers across all of our segments. However, sales and marketing expense as a percentage of net revenues in 2008, compared to 2007, is expected to decrease due to improved sales and marketing expense leverage in our Marketplaces segment, the relative growth in our Payments and Communications segments (each of which generally has lower relative sales and marketing expense as a percentage of net revenues than our Marketplaces segment), and our increased use of buyer and seller incentives (for which certain associated expenses are recorded as contra-revenue instead of sales and marketing expense).
 
This excerpt taken from the EBAY 10-Q filed Apr 24, 2008.
Sales and Marketing
 
                 
    Three Months Ended
    March 31,
  March 31,
    2007   2008
    (In thousands, except percentages)
 
Sales and marketing
  $ 443,252     $ 527,178  
As a percentage of net revenues
    25.1 %     24.0 %
 
Sales and marketing expense consists primarily of advertising costs, marketing programs, contractor costs and employee compensation for sales and marketing staff.
 
The increase in sales and marketing expense in the first quarter of 2008 of $83.9 million compared to the same period in the prior year was due primarily to our continued investment in growing and retaining our active user base. We direct customers to our websites primarily through a number of online marketing channels such as sponsored search, portal advertising, email campaigns and other initiatives. Our marketing expenses are largely variable, and are based primarily on growth in sales and changes in rates. Combined advertising and marketing costs increased $39.5 million in the first quarter of 2008 compared to same period in the prior year. Employee related costs, including the use of contractors, increased $30.0 million in the first quarter of 2008, compared to the same periods in the prior year, due to an increase in staffing.


23


Table of Contents

For the remainder of 2008, sales and marketing expense is expected to increase in total due to an expected increase in our marketing expenses to attract new customers and increase user activity across all of our segments. However, sales and marketing expense as a percentage of net revenues is expected to decrease due to improved sales and marketing expense leverage in our Marketplaces segment, the relative growth in our Payments and Communications segments each of which generally has lower relative sales and marketing expense as a percentage of net revenues than our Marketplaces segment, and our increased use of coupons (for which certain associated expenses are recorded as contra-revenue instead of sales and marketing expense) in an effort to improve buyer loyalty and retention.
 
This excerpt taken from the EBAY 10-Q filed Apr 24, 2008.
Sales and Marketing
 
                 
    Three Months Ended
    March 31,
  March 31,
    2007   2008
    (In thousands, except percentages)
 
Sales and marketing
  $ 443,252     $ 527,178  
As a percentage of net revenues
    25.1 %     24.0 %
 
Sales and marketing expense consists primarily of advertising costs, marketing programs, contractor costs and employee compensation for sales and marketing staff.
 
The increase in sales and marketing expense in the first quarter of 2008 of $83.9 million compared to the same period in the prior year was due primarily to our continued investment in growing and retaining our active user base. We direct customers to our websites primarily through a number of online marketing channels such as sponsored search, portal advertising, email campaigns and other initiatives. Our marketing expenses are largely variable, and are based primarily on growth in sales and changes in rates. Combined advertising and marketing costs increased $39.5 million in the first quarter of 2008 compared to same period in the prior year. Employee related costs, including the use of contractors, increased $30.0 million in the first quarter of 2008, compared to the same periods in the prior year, due to an increase in staffing.


23


Table of Contents

For the remainder of 2008, sales and marketing expense is expected to increase in total due to an expected increase in our marketing expenses to attract new customers and increase user activity across all of our segments. However, sales and marketing expense as a percentage of net revenues is expected to decrease due to improved sales and marketing expense leverage in our Marketplaces segment, the relative growth in our Payments and Communications segments each of which generally has lower relative sales and marketing expense as a percentage of net revenues than our Marketplaces segment, and our increased use of coupons (for which certain associated expenses are recorded as contra-revenue instead of sales and marketing expense) in an effort to improve buyer loyalty and retention.
 
These excerpts taken from the EBAY 10-K filed Feb 29, 2008.
Sales and Marketing
 
                         
    2005     2006     2007  
    (in thousands, except percentages)  
 
Sales and marketing
  $ 1,185,929     $ 1,619,857     $ 1,925,393  
As a percentage of net revenues
    26.1 %     27.1 %     25.1 %
 
Sales and marketing expenses consist primarily of advertising costs, marketing programs and employee compensation for sales and marketing staff.
 
Sales and marketing expenses increased in total due to our continued investment in retaining and growing our active user base. We direct customers to our websites primarily through a number of online marketing channels such as sponsored search, portal advertising, email campaigns and other initiatives. Our marketing expenses are largely variable, based on growth in sales and changes in rates. Growth in advertising and marketing costs, as well as employee-related costs, comprised the majority of the increases. Combined advertising and marketing costs


57


Table of Contents

increased $222.5 million in 2007 compared to the prior year, due to an increase in global television and online marketing campaigns. Employee-related costs and the use of contractors increased by $48.7 million in 2007 as we continued to expand our domestic and international operations. Sales and marketing expenses as a percentage of net revenues decreased from 2006, due to more efficient spending within our Marketplaces segment as we continued to refine our marketing programs and the growth in our Payments and Communications segments, each of which has lower relative sales and marketing expenses than our Marketplaces segment.
 
Sales and marketing expenses increased in total and as a percentage of total net revenues in 2006 due to our continued investment in growing our global user base and the effect of stock-based compensation expense related to equity awards and employee stock purchases under FAS 123(R). Growth in advertising and marketing costs as well as employee-related costs comprised the majority of the increases. Combined advertising and marketing costs increased $250.5 million in 2006 compared to the prior year, due to an increase in global television and online marketing campaigns. Employee-related costs, not including stock-based compensation expense, increased by $69.3 million in 2006 as we continued to expand our domestic and international operations. Stock-based compensation expense of $96.5 million was included in sales and marketing expense in 2006 compared to $8.7 million in 2005. Stock-based compensation expense increased due to our implementation of FAS 123(R) at the beginning of 2006.
 
For 2008, sales and marketing expense is expected to increase in total due to our increased efforts to retain existing active users and increase activity across all of our segments. However, sales and marketing expense as a percentage of net revenues is expected to decrease slightly due to improved sales and marketing expense leverage in our Marketplaces segment and the relative growth in our Payments and Communications segments (each of which has lower sales and marketing expenses than our Marketplaces segment).
 
Sales
and Marketing



 







































































                         

 

 

2005

 

 

2006

 

 

2007

 

 

 

(in thousands, except percentages)

 
 


Sales and marketing


 

$

1,185,929

 

 

$

1,619,857

 

 

$

1,925,393

 


As a percentage of net revenues


 

 

26.1

%

 

 

27.1

%

 

 

25.1

%






 



Sales and marketing expenses consist primarily of advertising
costs, marketing programs and employee compensation for sales
and marketing staff.


 



Sales and marketing expenses increased in total due to our
continued investment in retaining and growing our active user
base. We direct customers to our websites primarily through a
number of online marketing channels such as sponsored search,
portal advertising, email campaigns and other initiatives. Our
marketing expenses are largely variable, based on growth in
sales and changes in rates. Growth in advertising and marketing
costs, as well as employee-related costs, comprised the majority
of the increases. Combined advertising and marketing costs





57





Table of Contents






increased $222.5 million in 2007 compared to the prior
year, due to an increase in global television and online
marketing campaigns. Employee-related costs and the use of
contractors increased by $48.7 million in 2007 as we
continued to expand our domestic and international operations.
Sales and marketing expenses as a percentage of net revenues
decreased from 2006, due to more efficient spending within our
Marketplaces segment as we continued to refine our marketing
programs and the growth in our Payments and Communications
segments, each of which has lower relative sales and marketing
expenses than our Marketplaces segment.


 



Sales and marketing expenses increased in total and as a
percentage of total net revenues in 2006 due to our continued
investment in growing our global user base and the effect of
stock-based compensation expense related to equity awards and
employee stock purchases under FAS 123(R). Growth in
advertising and marketing costs as well as employee-related
costs comprised the majority of the increases. Combined
advertising and marketing costs increased $250.5 million in
2006 compared to the prior year, due to an increase in global
television and online marketing campaigns. Employee-related
costs, not including stock-based compensation expense, increased
by $69.3 million in 2006 as we continued to expand our
domestic and international operations. Stock-based compensation
expense of $96.5 million was included in sales and
marketing expense in 2006 compared to $8.7 million in 2005.
Stock-based compensation expense increased due to our
implementation of FAS 123(R) at the beginning of 2006.


 



For 2008, sales and marketing expense is expected to increase in
total due to our increased efforts to retain existing active
users and increase activity across all of our segments. However,
sales and marketing expense as a percentage of net revenues is
expected to decrease slightly due to improved sales and
marketing expense leverage in our Marketplaces segment and the
relative growth in our Payments and Communications segments
(each of which has lower sales and marketing expenses than our
Marketplaces segment).


 




This excerpt taken from the EBAY 10-Q filed Oct 29, 2007.
Sales and Marketing
 
                                                 
    Three Months Ended           Nine Months Ended        
    September 30,
    September 30,
    Percent
    September 30,
    September 30,
    Percent
 
    2006     2007     Change     2006     2007     Change  
    (In thousands, except percentages)  
 
Sales and marketing
  $ 385,497     $ 485,240       26 %   $ 1,158,528     $ 1,406,260       21 %
As a percentage of net revenues
    26.6 %     25.7 %             27.3 %     25.6 %        
 
Sales and marketing expense consists primarily of advertising costs, marketing programs, contractor costs and employee compensation for sales and marketing staff.
 
The increase in sales and marketing expense in the third quarter and the first nine months of 2007 of $99.7 million and $247.7 million, respectively, compared to the same periods in the prior year, was primarily due to our continued investment in growing and retaining our active user base. We direct customers to our websites primarily through a number of online marketing channels such as sponsored search, portal advertising, e-mail campaigns and other initiatives. Our marketing expenses are largely variable, based on growth in sales and changes in rates. Combined advertising and marketing costs increased $66.1 million and $193.5 million in the third quarter and first nine months of 2007, respectively, compared to same periods in the prior year. Employee related costs, including the use of contractors, increased $20.2 million and $35.4 million in the third quarter and first nine months of 2007, respectively, compared to the same periods in the prior year due to an increase in staffing.
 
For the remainder of 2007, sales and marketing expense is expected to increase in total due to an expected increase in our marketing expenses to attract new customers and increase user activity across all of our segments. However, sales and marketing expense as a percentage of net revenues is expected to slightly decrease due to improved sales and marketing expense leverage in our Marketplaces segment and the relative growth in our Payments and Communications segments, each of which generally has lower relative sales and marketing expense as a percentage of net revenues than our Marketplaces segment.
 
This excerpt taken from the EBAY 10-Q filed Jul 27, 2007.
Sales and Marketing
 
                                                 
    Three Months Ended       Six Months Ended    
    June 30,
  June 30,
  Percent
  June 30,
  June 30,
  Percent
    2006   2007   Change   2006   2007   Change
    (In thousands, except percentages)
 
Sales and marketing
  $ 384,347     $ 477,768       24 %   $ 773,031     $ 921,020       19 %
As a percentage of net revenues
    27.2 %     26.0 %             27.6 %     25.6 %        
 
Sales and marketing expenses consist primarily of advertising costs, marketing programs, contractor costs and employee compensation for sales and marketing staff.
 
The increase in sales and marketing expenses in the second quarter and the first six months of 2007 of $93.4 million and $148.0 million, respectively, compared to the same periods in the prior year was primarily due to our continued investment in growing and retaining our active user base. We direct customers to our websites primarily through a number of online marketing channels such as sponsored search, portal advertising, e-mail campaigns and other initiatives. Our marketing expenses are largely variable, based on growth in sales and change in rates. Combined advertising and marketing costs increased $82.3 million and $127.4 million in the second quarter and first six months of 2007, respectively, compared to same periods in the prior year. Employee related costs, including the use of contractors, increased $6.1 million and $15.2 million in the second quarter and first six months of 2007, respectively, compared to the same periods in the prior year due to an increase in staffing.
 
For the remainder of 2007, sales and marketing expenses are expected to increase in total due to an expected increase in our marketing expenses to attract new customers and increase user activity across all of our segments. Sales and marketing expenses as a percentage of net revenues are expected to slightly decrease due to improved sales and marketing expense leverage in our Marketplaces segment and the growth in our Payments and Communications segments, each of which generally has lower relative sales and marketing expenses as a percentage of net revenues than our Marketplaces segment.
 
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