How Facebook Marketplace became larger than eBay

This blog explores how Facebook is relying on its Marketplace to stay relevant with its younger users and its importance on Meta's future.

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Facebook's global reach remains massive, but its grip on younger users is slowly slipping. But one feature is still keeping users engaged: Marketplace. Since its launch in 2016, Facebook Marketplace, which is owned by Meta, has quietly become one of its biggest success stories. With 1.1 billion users in 70 countries, it's now one of the world's largest platforms for second-hand sales, rivalling eBay and Craigslist. So how important is Facebook Marketplace to Meta? And with Facebook's growth among younger users slowing, how crucial is Marketplace to its future?

One study found that only 32% of teens use Facebook, compared to 63% on TikTok and 61% on Instagram. Yet, Marketplace's billion monthly users suggest a different kind of engagement; one driven by necessity rather than social networking. Marketplace, which is primarily a C2C shopping destination where people go to sell or buy second-hand goods, is a big part of Meta's strategy to attract and keep those users on its platform. For younger consumers, Marketplace aligns with both financial necessity and sustainability. The global resale market is projected to hit $350 billion by 2027, fuelled by eco conscious and budget-savvy buyers.

The appeal isn't just about saving money, it's also about trust. Unlike other platforms, Facebook Marketplace offers more information regarding sellers, and it is a bit more transparent in terms of who you're buying from. This built in trust factor keeps users engaged, even if they rarely scroll the Facebook feed. Everyone is familiar with Facebook and with familiarity, often comes trust. One of the biggest advantages of Facebook Marketplace is how it is connected to Facebook profiles. This helps build the trust between buyers and sellers because people can see who they are dealing with. So it feels a bit more secure compared to completely anonymous platform.

For many users, local pickups are the real game changer as well. Instead of waiting for delivery, buyers can inspect items in person and sellers avoid logistics hassles. But now, Facebook is expanding Marketplace's reach. In January 2025, eBay announced a partnership with Facebook Marketplace, allowing select eBay listings to appear in the USA, Germany and France. Wells Fargo projects an additional $1.6 billion in gross merchandise volume for eBay by the end of 2025. A partnership between eBay and Facebook Marketplace will make it easier for eBay sellers to sell directly on Marketplace. That will boost the number of sellers and potentially buyers on Facebook Marketplace.

This partnership will help solve some of the trust problems that Marketplace has as eBay will be authenticating those items or adding buyer protection, which most purchases on Marketplace do not have. With this partnership, eBay get access to a much larger audience through Marketplace's huge user base and also Marketplace can offer a wider selection of a product list. So collaboration highlights a complementary relationship rather than direct competition, because each platform caters to different buyers and sellers.

Marketplace doesn't charge mandatory listing fees like other resale platforms and Marketplace ads cannot be bought separately. They're bundled with Facebook's broader ad network. So why does Meta keep it around? Marketplace is one of the least monetized areas of Facebook and it does not make a lot of money there. At least not directly. Even if Marketplace itself isn't a cash cow, it keeps people on Facebook longer, giving Meta more opportunities to serve ads and collect valuable data. According to a research firm, an average 18 to 24 year old spends only 11 minutes per day on the platform, compared to an hour on TikTok, but many of them still log in regularly, specifically for Marketplace.

This is valuable because advertisers follow engagement. When people log in to Marketplace. Meta collects valuable data, what users are searching for, what they're buying, and even their location preferences. This information helps optimize ad targeting across all of Meta's platforms, from Facebook to Instagram. Unlike eBay or Etsy, Meta doesn't take a cut of most transactions. The financial benefit for Facebook from Marketplace is largely indirect, meaning that Marketplace helps to bring in users and engagement, which is what advertisers are looking for when they're deciding where to allocate their budgets. And more broadly, about how it can convert Marketplace users into more traditional Facebook users. This is why Marketplace plays such a long term role in Meta's e-commerce strategy.

While Instagram is now responsible for about 50% of Meta's ad revenues. Facebook still needs a way to retain users, especially younger ones. The concept of Facebook is a bit outdated at this point in terms of a social media platform but people will not delete it anytime soon either as they have been using it for so long. The ultimate impact and longevity of Facebook, especially among young users, will largely depend on whether Meta is able to leverage Marketplace's popularity and funnel the users into the more monetised parts of its offerings.