For the past few years, eBay Inc. (NASDAQ: EBAY) has been on top of the e-commerce websites. But the website's long running dominance has been fading recently, and was made more evident this past month as the site posted smaller audience numbers than its main rival Amazon.com (NASDAQ: AMZN).
One of the main reasons for the changing of the guard last month was the fact that Amazon has tapped into the secret of eBay's success. Amazon is taking a page right out of eBay's play book and allowing independent sellers to post items on the site for other users to purchase.
eBay users have been sending the company a message that they are starting to grow tired of higher fees, and increased numbers of counterfeit products that can be found on the company's website. eBay has vowed to do its best to keep counterfeit items off the site, but for now buyers are still wary of items being sold on the site.
According to Nielsen Online, in December more Americans visited Amazon than they did eBay. This is the first month that this has ever taken place, and although the difference was slim, it is still a pretty remarkable feat for Amazon. During the month Nielsen reports that 59,624,000 Americans spent their time looking at Amazon pages, while eBay counted "only" 59,374,000 visitors.
What is most alarming is the drop in eBay's audience base year over year. Based on December numbers, the company had a massive 10 percent from the same period of last year. The internet is a picky place, and drops in viewers of this size could definitely be a signal that worse things are on the horizon.
eBay.com did however still out pace Amazon.com in the number of page views it gets and the amount of time users spend on the service. But before you start to assume that this is a positive spin to the story, some analysts contend that is is actually a negative sign, and that what we are actually seeing is a sign that it is easier for people to find what they are looking for on Amazon than on eBay.
After Amazon added new digital music and video download stores on its sites, traffic in the United States to the company has increased 18 percent over the past year.
Now it is just a matter of time to see which company will keep the e-commerce traffic crown. It would be silly to totally count out eBay just yet. It is possible that the recent drop in confidence can be reversed for eBay users, or maybe Americans just prefer Amazon. We will see...
Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.
