eBay hacking incident was bad for sales
24 July 2014 - 10:04 by Graham Miller
Online auction site eBay revealed in May of this year that it had been attacked by hackers, who had managed to get away with information relating to around145 million users. And after posting information about its sales performance over the past year, eBay admitted this month that the security breach had been a bit of a setback, according to the Telegraph.
In spite of concerns over security, the firm actually managed to generate a 13 per cent growth in revenues during the second quarter of 2014, largely due to the rise in the usage of PayPal, which it owns.
In a statement, the retailer said that the past three months have been very challenging, with the cyber attack putting customers on edge and causing its share prices to slide southwards. In addition, there have been strong sales from rivals like Amazon to contend with, while high street chains are also making an effort to offer compelling solutions for safe shopping online at the moment.
eBay has long since addressed the issue which allowed hackers to gain access to user information. And such breaches are not uncommon, because organisations of this size are always high priority targets for cybercriminals.
For eBay, maintaining its own reputation is perhaps less important than protecting the image of PayPal, which relies on the trust of millions of users because it handles financial transactions and has access to bank accounts.
PayPal is also having to step up and take on a rival payments service from Amazon, which could eat into its market share. But by embracing the mobile marketplace and also cropping up in-store, PayPal is not limited solely to safe shopping online and stands a good chance of retaining current growth levels, thus benefitting eBay as a whole.