EBAY

Ebay

Ebay

What is it about Frank Oltscher that makes him a dream customer for eBay chief executive Meg Whitman and her managers? He's an avid trader — he's even bought a marble fireplace online — but that doesn't exactly explain it. After all, some hardcore eBay customers buy more in a single day than Oltscher in the past two years. And true, his percomputer homepage is eBay, which is fairly intense. But it still pales next to other expressions of addiction to the site, like the eBay tattoo a woman in Louisiana had inked onto her ankle not long ago. No, what makes Oltscher special — what, until recently, set him apart from most other eBay users — is this: He does his trading from his Berlin apartment through eBay's German auction website. That makes him the kind of customer Whitman & Co. lust after today, the validation of a strategic thrust that is poised to propel eBay, already one of the fastest-growing companies in history, into a new phase of turbocharged global expansion.

Five years ago eBay had virtually no international operations. Today its global business is surging. The company has 31 sites straddling the globe, from Brazil to Germany to China. They generated an estimated $1.1 billion in 2004 sales — 46 percent of eBay's overall trading revenues — and are growing twice as fast as the company's domestic operations. International trading revenues are likely to surpass domestic in 2005. "International is a very important part of the future growth," says Whitman, sitting in a conference room at eBay's San Jose headquarters. "We're entering new countries that are at a much earlier stage of e-commerce development than the U.S. They should provide higher levels of growth for the foreseeable future."

Of eBay's 125 million registered users, roughly half are outside the United States. These international online shoppers buy a garden gnome every six minutes in Germany, a soccer jersey every five minutes in Britain, a bottle of wine every three minutes in France, and a skin-care product every 30 seconds in China. All told, they're estimated to have traded at least $16 billion worth of goods in 2004. "At the most basic level," says Matt Bannick, president of eBay International, "this concept travels pretty well."

That much is clear. But eBay's international advance is not merely a matter of breezing into foreign territory and throwing up some signs saying "Electronic flea market today!" eBay appears to have cracked the code for one of the toughest tasks in the increasingly interconnected global economy: transplanting a hit business concept into places with vastly different cultures and allowing it enough flexibility to adapt to local conditions without losing the core elements that made it a phenomenon in the first place. How has eBay done this? Gregory Boutte, the country manager for eBay France, provides a simple answer: "The eBay playbook explains the success of eBay."

He's not speaking metaphorically. There is an actual playbook. It consists of several hundred webpages of the collective wisdom of all of ...