Actually most of the Analyst Day Presentation is fluff that purposely hides some of the nuggets on eBay’s strategy for addressing its myriad of problems challenges. As always, Rob Hoff (who, btw, is the only blogger that actually writes about eBay ) has a good summary of the key issue cutting through all the marketing speak.

* Most interesting of all, eBay CEO Meg Whitman suggested that eBay’s reputation system, PayPal’s wallet, and Skype’s ability to let people have a constant online presence each could be decoupled from their respective services and offered as components of entirely new kinds of services. Meg didn’t specifically mentions offering them up to software developers, but said they could become the building blocks for a more customized Web.

So yes, eBay is now trying to stay ahead of the innovation curve by attempting to “micro-chunk” web services and not just content. Not so revolutionary from some perspective but defintely important for all the startups in the space.

In the end, its comforting to know that all the issues/ideas/projects do end up being bubbled up to senior executives . . . hopefully through the right business owners and not just another strategy thought piece ( ala the infamous McKinsey dossier)

“Defeating Feature Fatigue,” Harvard Business Review is the first academic research I’ve came across that tried to quantify the negative impact of feature creep while attempting to manage trade-offs from reduced sales. To put it in another angle, in the world of iPod, “less is more” is fastly becoming the new mantra (deservedly so) but as with everything, moderation is always the happy medium.

To get the right mix of capability and usability in a product, managers need much more guidance than the general advice that “less is more.” On the basis of our results, we developed an analytical model to help managers balance the sales benefits of adding features against the customer equity costs of feature fatigue. The model steers decision makers away from the extremes—too few features to capture initial sales or too many features to ensure ease of use—and toward a middle ground that maximizes the net present value of the typical customer’s profit stream. The model also demonstrates that the optimal number of features depends on a company’s objectives.

Furthermore, the study cautions that buyer loves to BUY features but hates to USE features. As a result, a feature rich product might generate huge marketshare gains initially from first time buyers, it might not recieve word of mouth support because these buyers ended up with feature fatique (eventhough they bought the product for the features in the first place).

One way or another, managers must correct for the misleading information that many market-research techniques deliver. As noted, our findings call into question the predictive power of attribute-based models for determining the optimal number of features. If companies conduct market research by asking consumers to evaluate products without using them, too much weight will be given to capability, and the result will likely be products with too many features. Instead, designing research that gives consumers an opportunity to use actual products or prototypes may increase the importance of usability so that its relevance in choice approaches its relevance in use.

Another interesting nugget is that packing features into a product is actually the anti-thesis of segment based marketing and product design. Find your target market, design a product for the market with the feature set that these users will LOVE to use, and no more . . . packing in everything ensures that your product is good enough for everyone, but never the best for a particular user.

Particularly in cases where a company has packed one model with many features to address market heterogeneity, consumer satisfaction might be greatly enhanced by tailoring products with limited sets of capabilities for various segments.

Perhaps device convergence is a pipe dream after all . . . or atleast in the current incarnation . . .