LONDON (Reuters) - Already reaping the benefits of a common European currency, U.S. online auctioneer Ebay will translate its online payment service PayPal into a variety of languages to boost cross-border trade in Europe.
Earlier this year Ebay added euro and sterling denomination payment capabilities to its PayPal service, enabling customers in Germany to buy a rare book or automobile from a trader in say, France, with a few clicks of a button.
The adoption of the euro last year was an important catalyst to spur continental Europeans into trading with cross-border neighbours, Michael van Swaaij, managing director of Ebay Europe, told Reuters on Friday.
But because PayPal is written in English, its user base has been confined to all but avid traders outside the United States, UK and Ireland, leaving a large potential market untapped.
Users of PayPal, a service EBay acquired a year ago, can finalise purchases in moments, shaving costs and time involved with using personal cheques and money transfers to complete a transaction.
"It could take a week or longer depending on the bank dealing a money transfer, and the costs generally are quite high," said van Swaaij.
Bank transfers, money orders and personal cheques are still the most common transaction method for many of EBay's 75 million registered global users. Cutting the red tape is seen as vital to boosting international trading activity and growing the company's profitable overseas business.
"What we'll start to do in the next few quarters is to roll it out in the next few languages (after English)," van Swaaij said. These languages include German, French and Dutch.
"It's hard to accurately predict, but we know it will have a positive effect on international trade."
He added that the translation upgrade would take a few quarters to complete, but would not dent Ebay's bottom line.
OVERSEAS ATTENTION
Ebay has been at the vanguard of the Internet stock comeback over the past year. Shares are up roughly 130 percent since October as sales -- particularly from overseas transactions -- continue to outpace analyst forecasts.
Ebay was trading at $111 (68 pounds) in pre-market activity on Friday on Instinet, down more that four percent from Thursday's close.
On Thursday, the company reported it more than doubled its quarterly profit to $109.7 million on revenues of $509.3 million. It also boosted its year-end sales outlook slightly to $$2.075 billion and announced a two-for-one stock split.
Ebay's 20 country sites in Europe, Asia and South America racked up revenues of $155.2 million, or 38 percent, of total second quarter sales. International revenues accounted for roughly one-quarter of sales a year ago.
Investors and analysts are paying closer attention to the overseas business units of U.S.-based Ebay, Amazon.com and travel service Expedia as a key indicator for grading the companies' growth potential and assessing their lofty share prices.
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Source:
Reuters
