eBay Buys Hunch To Boost Recommendations

SAN FRANCISCO (Reuters) - EBay (EBAY.O) said it acquired the data analysis firm Hunch to help it develop more recommendation technology for its online marketplace.

Chris Dixon, Tom Pinckney and Matt Gattis, who founded Hunch in 2009, will stay on at eBay and remain based in New York. The purchase price was not disclosed.

Hunch analyzes data from social networks like Facebook and from questionnaires to make personal recommendations. EBay said Hunch will help it suggest relevant products for shoppers on its online marketplace.

This is the latest in a string of acquisitions by eBay as it tries to revive its online marketplace, which has lost market share in recent years to Amazon.com Inc (AMZN.O), the world's largest retailer.

Most retailers, like Amazon, have inventory that they can catalog and use to recommend related products to customers. In contrast, eBay's Marketplaces business offers items from other sellers, and a lot of the products are used and unique. This creates a lot of unstructured data that is harder to analyze for search and recommendations.

"Hunch was solving a similar problem with unstructured data," said Mark Carges, chief technology officer at eBay. "The type of technologies were similar enough that this makes sense."

Hunch's Dixon said the company was attracted by the large amount of data eBay has amassed. Becoming part of eBay will give Hunch unfettered access to analyze this information.

(Reporting by Alistair Barr; editing by John Wallace)

Copyright 2011 Thomson Reuters. Click for Restrictions

Comments

[teryflwr4u]

12:03 PM on 11/22/2011

Between the fees from Ebay and from Pay Pal, a big chunk of money is taken out of every sale you make. Now they waste money on a company to tell buyers what else they might be interested in. Ebay is circling the drain.

[Gilbert Albright]

08:33 AM on 11/22/2011

I have a HUNCH that this is a waste of money. Ebay will continue to decline because it's greedy tactics have driven away most of it's longtime loyal seller base. And it is not attracting new ones.

[t5rewqas]

07:37 PM on 11/21/2011

Did anyone at Ebay actually use Hunch before they purchased it? My results have been random at best. I would actually love to see the data on a double-blind test of Hunch recommendations versus random ones. Early adopters love Hunch because their taste is mirrored back to them which they confuse with relevance. Try searching for a product on Hunch and on StylePath.com and see which one is more useful. I guess nineteen million and some proven names buys a lot of smoke and mirrors.

[NerdyStudent]

02:24 PM on 11/21/2011

Still rake in about 17% of my yearly sales and income from eBay, but boy, if we could lower those friggin' fees that'd be glorious...