Can "Promoted Listings" Drive Revenues For eBay?

Recently, eBay expanded the product categories that can use its advertising feature, “Promoted Listings”, which was launched last year. This advertising product allows sellers to increase the visibility of their products and attract traffic to their listings on eBay by prominently featuring their products on the website. eBay charges the seller only if a sale is made by clicking on the advertisement and this feature is available to sellers with an eBay stores subscription. We believe this product can increase eBay's transaction revenues, as it will drive traffic towards products and increase buyer awareness. The transaction revenue segment is the most valuable division for eBay, accounting for more than 70% of its valuation, according to our estimates. While advertising revenue in the cost per sale model might be limited, it can increase the average spend per user on eBay's platform, which according to our estimates is a key driver of transaction revenues.