EBay’s Close5 classifieds mobile application continues to gain traction, with nearly 3 million downloads in the United States as of the end of the third quarter, a ten-times increase from the previous quarter.

Close5 was launched November 2014, enabling users to buy and sell items to others in their area. EBay, which is trying to position itself for growth since spinning off the PayPal business in July, told analysts this week it is investing in Close5 and sees significant potential in this space.

“Obviously, [the U.S. is] an enormous potential market, but what we see is that the Classifieds space in the U.S. has been thrown up for grabs and it’s a very big market opportunity and we think we’ve got a winning proposition with Close5,” said Devin Wenig, CEO of eBay. “It is growing very, very rapidly.”

Mr. Wenig commented during a conference call with analysts this week to discuss eBay’s third quarter financial results.

Items for sale
For the third quarter ended Sept. 30, eBay reported revenue of $2.1 billion and a 6 percent increase in gross merchandise volume.

With the PayPal business now operating separately, eBay is focused on classifieds and ecommerce, with mobile playing a big role for both. The company could face an uphill battle (see story).

The Close5 classifieds app enables users to find items for sale within five miles and list items for sales in seconds without the need to include a price or description. Users can also extend their search beyond five miles to find items in other areas.

Users can watch a particular item, ask questions about items and make an offer. Once an offer is accepted, users can chat privately to discuss when and where to meet without the need to exchange phone numbers or emails.

EBay also offers classifieds solutions Britain, Australia, Canada and Germany, among other countries.

Historically, the classifieds market has tended to be dominated by one player. EBay claims to have a leading position in the markets where it has a presence except for where it has planted seeds with the goal of gaining leadership.

Discovery
The core eBay business also continues to focus heavily on mobile, with a new experienced launched across all mobile channels in September (see story).

The new mobile offering shifts the focus towards a discovery-based experience for buyers and enhances the mobile selling experience. The new experience also brings in new functionality from several vertical apps in the automotive, fashion and other categories that were decommissioned in the third quarter.

EBay also unified the mobile experience across platforms for a consistent user interface that is helping drive faster iteration.

Given the changes, eBay is expecting to see an initial dip in use and ratings followed by a strong recovery, which is the path that the brand’s new iPad app followed last year.

Despite the changes, the percentage of gross merchandise volume that closed mobile increased by 1 percent for a total of 42 percent.

“We believe that moving in this direction with our products will enable us to drive engagement and cross-category purchasing,” Mr. Wenig said. “It’s also a better expression of our brand, which stands for discovery and the thrill of finding unique items and incredible deals.

“We believe this experience will ultimately help eBay become a more differentiated and a more personal commerce destination,” he said.

Final Take
Chantal Tode is senior editor on Mobile Commerce Daily, New York