eBay was in direct competition with Amazon in the early 2000's, but they had very different methodologies when approaching the market. The mistakes that eBay made during this time ultimately led to a huge difference in the trajectory of where these companies are today. On another episode of the Rocketship.fm podcast, I discuss my time at eBay from 2001-2005.
Here are the top three takeaways:
- Start with your customer. Measure the success of your product through your customers' eyes first, rather than exclusively on internal-focused metrics. At eBay, we measured the success of search based on the number of search results clicked, rather than considering that the customer is trying to find what they want as fast as possible (more clicks isn't what they want).
- Focus primarily on the demand-side of the equation. It's the job of the product manager's job to think bigger and ask, "what will keep users coming back?". In the case of eBay, we considered the sellers our customers, rather than buyers, and optimized our products for them.
- Consider the second-order effects. Design systems in which the incentives of all parties will be aligned. This is the key driver of product-led growth. eBay didn't do enough to satisfy buyers and therefore lost those users to Amazon, forcing sellers to follow buyers to Amazon.