eBay Bets on Social Commerce With Acquisition of the Gifts Project

EBay is getting more serious about social commerce by announcing its first acquisition in the space, following heavy investments in acquisitions over the past year that focused on mobile.

EBay says it has acquired the technology and team behind the Gifts Project, a social commerce platform that enables multiple friends to pitch in — or contribute a particular sum — toward an item for a birthday or other event.

The Gifts Project has been powering eBay’s version of the concept called Group Gifts for almost a year. The Tel Aviv-based company is backed by angel investors and Gemini Israel Fund and Index Ventures.

Going forward, the Gifts Project will become eBay’s Israel Social Center, which will focus on building social shopping platforms and product features for eBay Marketplaces. The Gifts Project’s employees will remain with the company, including co-founders Ron Gura, who will head up the Social Center; Matan Bar, who will become head of product; and Erez Dickman, the head of engineering.

The Gifts Project will report to eBay’s new VP of social commerce, Don Bradford, who joined eBay in May after working at both Microsoft and Yahoo.

Along with several other major retailers and start-ups, eBay has conducted a handful of experiments to determine what social commerce is, and how best to leverage shopping on social networks, like Facebook.

So far, eBay’s social efforts have been limited.

Besides group gift-buying, eBay has been developing ways for a consumer to log in to his or her Facebook account on eBay’s homepage and get product recommendations based on past purchasing habits. Another feature expected to launch sometime this year will allow users to post multiple products to their Facebook pages, to get their friends to vote on which item they should buy.

Earlier this summer, Christopher Payne, the head of North America for eBay, told me: “Social is a top-level initiative. It’s something that leaders are spending a considerable amount of energy on.”

Besides social commerce, mobile has also been a high-level priority for eBay and PayPal. The company has acquired Milo, which aggregates the availability of products in retail stores; Zong, which is a mobile payments provider; and Where, a mobile advertising company.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik