eBay Storefronts Arrive

Auction leader eBay (Nasdaq: EBAY) launched its much-anticipated storefronts project, known as eBay Stores, on Monday.

The project will begin with a two-week pilot program involving leading eBay sellers, and will be available to all qualified sellers starting June 18th.

"eBay Stores is the next step in eBay's evolution," eBay president and chief executive officer Meg Whitman said. "Our sellers should realize increased sales as buyers become familiar with their stores."

Designed to give a sense of the range of opportunities the storefronts present, the test involves sellers who deal in musical instruments, jewelry, electronics and collectibles. San Jose, California-based eBay described the test sellers as small business owners looking to expand their ability to sell online.

Participants Big and Small

Among the sellers who will run an eBay Store is Michael Pagliaro, known on the site as Instrumentguy. Pagliaro said he has sold musical instruments on eBay since 1998.

The storefront will enable him to create customer loyalty by "making it easy for buyers to shop," he said.

However, eBay also noted that large companies, including IBM (NYSE: IBM) (NYSE: IBM) and the Hard Rock Cafe, have signed up to operate eBay Stores as well.

Feedback Wanted

eBay said it plans to add additional features to the stores in coming months, including a shopping cart feature, full integration of listings from its fixed-price marketplace, Half.com, and customization options.

An eBay Stores Hub -- a directory of all storefronts -- will be launched in mid-summer, along with a planned grand opening once sellers have staked their ground. In the meantime, the new endeavor should not be confused with the eBay Store, which sells eBay-branded paraphernalia.

Eventually, sellers will pay a monthly subscription fee of US$9.95, as well as 5 cents per item, to list products for sale. However, until September, sellers will pay only final value fees of 1.25 to 5 percent of the sales price.

All Hands

eBay's storefronts undertaking is part of a massive mobilization designed to help eBay meet an ambitious sales forecast that entails the company increasing sales by 50 percent each year.

In May, eBay said it would test a newspaper classifieds program designed to expose a new audience to its auction listings.

Late last week, eBay announced a pact with Terra Lycos, integrating eBay's auctions into the Spanish Internet giant's portal site and other online properties worldwide. Analysts predict additional deals between eBay and Internet portals as eBay seeks to expand its presence to all corners of the Web.