...they just did more research prior to jumping into the market. Because E-bay was having problems with the Internet accessibilities, Chinese students opted to use local companies instead. E-bay is not the only brand image. There are more brands out there, such as Google. When you are competing with others, you want to try and beat their price just enough that you won’t shoot yourself in the foot. E-bay did not have the better deal. Because China is said to be a fast growing and frustratingly tough to crack market, E-bay chose to enter into a joint venture with them. Even though E-bay is a billion dollar global powerhouse in Internet commerce, they have continued to struggle in Asia. South Korea is considered the strongest Asian market. It was stated by Lee Hyun Chang, director at ebay....
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...that have caused eBay to struggle in Japan, China, and other Asian markets to determine if these mistakes could have been avoided. One factor that has made eBay to struggle in Asian countries was its failure to recognize the differences that existed between the Asian markets and market users and the American markets and markets users. This lack of understanding made eBay to use the strategies it had used in the US to enter the Japanese and the American markets. At the initial launch in Japan eBay set out to use collectibles this strategy was successful in the US market. This seemed to have failed as the Japanese user seemed to have preferred new products. The second mistake was eBay strategy to charge commission on each transaction as it did in the US. The Japanese market did not favor this as they were not used to pay commission or monthly charges. The second factor that made eBay to struggle in the Asian markets is its strategy of attempting to dominate the market by crashing all competition including the local. This proved to be a wrong kind of strategy as local competitors had a competitive edge over eBay. This was demonstrated by eBay earlier battle with Alibaba for the control of the Chinese market which eBay ended up losing badly to the local players. Due to the differences in market and business environments in Asia local companies that are used to these environments usually find an edge over foreign entrants and strategies such as that used by eBay have high probabilities...
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...The situation in Asia is somewhat ironic given that in the U.S. Yahoo and eBay have forged An alliance to protect their dominance in the $12.5 billion online advertising market against Google. But in Asia, the eBay-Yahoo rivalry is ferocious (BusinessWeek.com, 5/26/06, Tech Titans Take Sides). Yes, Yahoo is a big reason that E-bay globalization in the Asian market isn’t successful. Though yahoo has some responsibility in EBAY unsuccessful Asian Market, EBay has lack the ability to conform its business model to the Asian market. EBay inability to tailor its product to the Asian Market has also been a major reason for their failure in the Asian Market. In major markets like Japan, Korea and China, Yahoo subsidiary have outperformed EBay. EBay has a simple business model of drawing revenue from passing information between seller and buyer, which require no necessity to have inventory or ship goods. This business model was embraced by foreign markets including UK, France, Germany and surely became a leader in e-commerce in the US. This success didn’t translate to the Asian Market. The reason is due to neglect of the four P’s concept, adoption, standardization, and entry time and entry market. EBay begin its entry into the Asian market in Japan, but missed their ideal time to enter the market. Yahoo had entered the Japan market six months prior to EBay. This allowed yahoo enough time to accumulate enough market power to force EBay out. Not only...
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...sell their own personal items to anyone with internet access at any time. eBay is full of much strength such as their ability to globalize their brand. This is also one of their main weaknesses. Since eBay is an online business, anyone with internet can access the website. While they have the potential to reach out to everyone, not everyone uses the internet. One of the issues eBay faces is that the internet usage in Asia is very low especially considering over half the population resides there. E commerce was growing everywhere which definitely helps eBay’s business. One of eBay’s great accomplishments is their ability to acquire several other successful businesses. They don’t just take over random businesses because they can; they acquire businesses that can help them out with their own business. For example, PayPal goes hand in hand with the type of business eBay runs. It gives users a more secure way to use their website which consumers definitely appreciate. Along with their feedback forum which allows consumers to voice their opinions, the fact that both sides (buys and sellers) feed off one another and cause the popularity of the other side to rise really makes consumers feel like they are a part of the business. This is part of what makes eBay such a great success. Although they have their share of challenges with globalization and competition, they do so many things right. The idea of eBay originated from French born Pierre Omidyar, a computer science graduate from...
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...eBay Problem Statement Webster University eBay Problem Statement eBay’s organizational structure of functional design needs changes to maintain a competitive advantage and to react quickly and efficiently to the external environment. Analysis and Evaluation eBay has had tremendous growth from late 1998 to 2007, with acquiring PayPal, Skype, Butterfield & Butterfield, and Half.com. eBay started with revenue sliding in the fourth quarter of 2007 (down 6.6%). Then like so many other companies the recession of 2008 hit the market and eBay’s revenue hard. eBay will need to remodel the organizational structure of their business divisions to achieve growth and profit, with unstable markets. The functional organization structure that has been in place for eBay has been a great building block for the organization. The functional structure does allow an organization to achieve economies of scale and operate more efficiently because employees become authorities within their area of the organization. The downside of the functional organization is that it is best for simple/stable environments. The functional structure may allow individuals/management to care more about their individual function, rather than the company as a whole. eBay has now outgrown the functional structure of their organization with the slow response to customer demands of the online market, and the nonintegrating of the functional units of finance, human resources, and legal, in regards to the various...
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...Strategic Management: ‘Making eBay Work’ Case Study Abstract The following report will analyse the methods and strategies eBay have used in order to gain competitive advantage over its rivals to become the largest auction site in operation. Introduction eBay is a worldwide e-commerce business that has well and truly reaped the rewards of the internet revolution. The company operates on a global level, boasting several acquisitions of competitors to boost its market share, housing underneath the umbrella that is eBay are numerous divisions’ specialised products and services such as motor vehicles. (eBay, 2006) The following report will use two analysis tools, a SWOT analysis and Porter’s Five Forces analysis (1979) to study eBay which will be located in Appendix 1, specifically the analysis of eBay’s internal capabilities and external environment surrounding the e-commerce organisation. The report will use these analysis tools to assess the strategies implemented by eBay to remain both sustainable and profitable in the e-commerce industry, the main strategy to be discussed in depth is the eBay and its use of horizontal integration. The report will discuss this under the following headings: * External Analysis of eBay * Internal Analysis of eBay * Strategies Implemented * Analysis of Implemented Strategies External Analysis of eBay The external analysis will look study the pressures outside of the company that cause eBay to react in a positive or...
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...that have caused eBay to struggle in Japan, China, and other Asian markets to determine if these mistakes could have been avoided. One factor that has made eBay to struggle in Asian countries was its failure to recognize the differences that existed between the Asian markets and market users and the American markets and markets users. This lack of understanding made eBay to use the strategies it had used in the US to enter the Japanese and the American markets. At the initial launch in Japan eBay set out to use collectibles this strategy was successful in the US market. This seemed to have failed as the Japanese user seemed to have preferred new products. The second mistake was eBay strategy to charge commission on each transaction as it did in the US. The Japanese market did not favor this as they were not used to pay commission or monthly charges. The second factor that made eBay to struggle in the Asian markets is its strategy of attempting to dominate the market by crashing all competition including the local. This proved to be a wrong kind of strategy as local competitors had a competitive edge over eBay. This was demonstrated by eBay earlier battle with Alibaba for the control of the Chinese market which eBay ended up losing badly to the local players. Due to the differences in market and business environments in Asia local companies that are used to these environments usually find an edge over foreign entrants and strategies such as that used by eBay have high probabilities...
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...the Annual Report eBay Inc. is one of the largest e-commerce businesses listed in the Fortune 500. Like other companies, eBay Inc. prepares an Annual Report and a 10K every year in which it discloses each activity and financial performance. eBay Inc.’s Annual Report and 10K are designed for different audiences. The Annual Report provides information about the company’s activities and financial performance for shareholders and investors. The 10K is an official document that publicly traded companies must file with the U.S. Securities and Exchange Commission (SEC). The Annual Report provides specific growth of each activity such as eBay marketplace, PayPal, and Skype to increase the confidence of its shareholders and investors. The 10K provides detailed background and financial information targeted towards business professionals and the SEC. eBay Inc.’s 2009 Annual Report was a letter with a lot of details and numbers to demonstrate the performance. The CEO, John Donahoe, listed specific activities’ revenues and growths such as “In November 2009, we sold approximately 70 percent of Skype allowing us to focus on our two core growth engines: payments and e-commerce.” Also, Mr. Donahoe compared the growth of each activity to previous years. For example, in the first half of the year, on eBay marketplace, “we delivered $8.7 billion in revenues, a 2 percent increase from the prior year.” Mr. Donahoe used sincere language to build a strong relationship with eBay Inc.’s shareholders...
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...Management of Marketing Channels Case Study: EBAY EXPANDS AROUND THE GLOBE BACKGROUND eBay (www.ebay,com) is an online auction and shopping website wherein people can buy or sell variety of goods and services such as electronics, cars, sporting goods, clothing and apparel and etc. The company originally started in 1995 in San Jose California, and it expanded internationally by 2005. STATEMENT OF THE PROBLEM How can eBay more improve its international expansion? ASSUMPTIONS OF THE STUDY There are several assumptions presented in the case: 1. eBay has succeeded in its global operations due to its playbook strategy, a “how-to” manual that included several topics such as category management, and online marketing. 2. eBay adapts to the culture of the country but retains its core elements of online business model. 3. eBay first expanded to Germany by buying an established firm. Other countries where eBay also expanded are Great briatain, Australia, Italy, Netherlands and Spain. ALTERNATIVE COURSES OF ACTIONS 1. Profile your customers and personalize the website according to the country it serves. Pro: Profiling can help you get data of your current customer and their behavior. It can also help you to have a more focus product offerings Con: Requires additional costing and research 2. Offer various modes of payments such as payment over the counter (banks, convenience stores), debit card, cash on delivery Pro: Offering...
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...Prepared by : ID : Company Background Name | eBay Inc. | Logo | | Industries served | Internet, Online retailing | Geographic areas served | Worldwide | Headquarters | U.S. | Current CEO | John Donahoe | Revenue | $ 14.07 billion (2012) | Profit | $ 2.60 billion (2012) | Employees | 27,770 (2012) | Main Competitors | Amazon.com, Craigslist, Ubid, eBid Auctions, Google, Overstock.com and many others. | eBay is an international online marketplace with a global customer base of 233 million. It is a multibillion business operating in 37 countries. There are millions of items listed on eBay across thousands of categories, including antiques, toys, books, computers, sports and electronics, amongst many others. Strengths 1. World’s largest internet marketplace. eBay has more than 150 million live listings and more than 105 million active users globally in 37 countries. That makes eBay the largest marketplace online, having a great power over other online retailers. 2. Business model. eBay only acts as a middleman between sellers and buyers, who bid and sell items in eBay’s marketplace. Being a pioneer in online auctions, eBay had no competition and currently has only few strong direct competitors. Thus, company’s business model is a competitive advantage over such giant retailers as Amazon. 3. Economies of scale. In the beginning, eBay had to invest heavily to gain IT and customer relationship management (CRM) knowledge and skills, but...
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...Assess how these segments affect the corporation you chose and the industry in which it operates. EBay Inc. Is one of the leading internet companies in the world. Founded in 1995 by French Iranian Pierre Omidyar, eBay is employing more than 15500 people while generating total revenue of 11.65 billion dollars as of 2011 (eBay Inc 2011 Results). The company was founded in San Jose, California with a vision of connecting people rather then sells them goods. The company has now about a billion registered users and is the most popular shopping site on the Internet. EBay’s mission is to provide a global segment platform where practically anyone can trade practically anything. It features a variety of international sites, specialty sites, 50,000 categories of merchandise, and services that aim to provide users with the necessary tools for efficient online trading in both auction style as well as fixed price formats. Recently eBay added a Want It Now and Best Offer format providing new ways for shoppers to find and buy what they want on the website. Europe, Asia and cross-border trade are major areas of growth for eBay and an immense source of revenue. The firm offers localized sites in 24 countries. On any given day, millions of items are listed on eBay in thousands of categories. People from all over the world buy and sell on eBay (Hellriegel, D., & Slocum). EBay also acquired a number of other companies. These acquisitions include the following: • PayPal. This...
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...eBay first entered the Chinese market in 2002 by acquiring a 33% stake in its local counterpart, EachNet, followed by a full acquisition a year later in 2003. Critically assess eBay.s choice of market entry strategy for China, listing both the advantages and disadvantages of its acquisition strategy. As we know, eBay’s China expansion strategy can be considered as failure, despite the fact that eBay entered this potentially rewarding market with caution. This cautious strategy was very unusual for eBay, because they used full-forced, head-on, .be-first-or-nothing. strategy in other markets, for various reasons, it would be impossible to implement this strategy when penetrating Chinese market. So acquiring an already comparatively recognizable and well established brand seemed to be the best way to continue eBay’s expansion in Asia. Without a doubt, Each Net was the best candidate for acquisition at the time. When eBay acquired 33% shares of Each Net in 2002, it seemed to be hugely successful, because in year 2003 the value of Each Net had doubled and market share had rocketed to 85% - this initial success encouraged full acquisition of Each Net. As we know, the success did not turn out to be long-lasting, despite the fact that in first few years the performance of the company was brilliant. While acquisition of Each Net meant many advantages for eBay, it also implied serious disadvantages. Advantages of Each Net acquisition: • Each net had strong financial backing from...
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...company – EachNet was a significant player in the Chinese online auction market and controlled more than 50% of the market share. EachNet was the Chinese EBAY, with sensitivity to differences between the US and Chinese market. • Using well founded company with hard resources in china – Warehouses, shipping company, contracts with local supplier Etc. This will let Ebay, a smoother entrance to the market. Disadvantages • Trust issues – The Chinese customers hadhard time trusting new foreign companies, changing the brand name to EBAY EachNet emphasis this fact. • Chinese/ US culture difference – The Americans executives had a hard time adjusting to Chinese way of doing things. For example: service that was offered to the customers was a DIY, where the Chinese expected a service hotline. • “be first of nothing”, EBAY’s usual strategy, was not implemented , they didn’t have the experience nor control they were used to. Q2. Potential benefits and risks of the joint venture with TOM online: Benefits • Connections – In china connections to officials are very important for business. TOM’s biggest shareholder was well connected with high ranking officials in China and Hong Kong. • Local name & Brand -Tom's brand name and local knowledge are a key factor. • Diversifying–This joint venture allowed EBAY to enter the mobile commerce market, their users could participate in online auctions using their mobile phone, PDA etc, a sector in which TOM had been a...
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...NEW DELHI: The US, the UK and Australia rank as the top three destinations for export of Indian goods at the online marketplace, eBay, says a study. According to eBay's 'Asian Exporters Index', sales from large Indian exporters on eBay has grown by 85 per cent year-on-year, the second fastest across the Asia Pacific region. "The Indian export market presents a story of exuberant growth, driven mainly by artisans and small-scale manufacturers. "India has a unique strength in hand-crafted value oriented product lines such as diamonds, jewellery, ethnic Indian clothing and handicrafts. Exporters can use eBay's platform to reach out to customers globally," eBay India Director (Categories) Kashyap Vadapalli told reporters here. Canada, Germany, France and Italy are some other major destinations for exporters using eBay for transactions. In terms of products shipped, books, fashion earrings, pendents and Indian stamps were the top categories, followed by PC games, movie DVDs and belly dancing apparel. However, in terms of the top Asian export markets, India does not make it to the top 5 countries. China leads the Asian export market on the website, while Hong Kong, Japan, Thailand and Korea follow in the tally. "The e-commerce market in India offers tremendous potential to the business community. It is expected to grow by 47 per cent to reach the value of USD 10.3 billion during the year 2011 from USD 7 billion during 2010," FIEO Director Chandranath Som said. High internet...
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...technical opinion DOI: 10.1145/ 1435417.1435450 BY CAROL XIAOJUAN OU, ROBERT M. DAVISON Why eBay Lost to TaoBao in China: The Global Advantage electronic commerce involves electronically-facilitated transactions between consumers through third parties.9 In China, a number of C2C platforms have emerged, such as eBay (China), TaoBao and PaiPai. TaoBao, established in 2003, has quickly assumed a dominant position in this market, underlined by the December 2006 decision by eBay to quit the C2C market in China altogether,4, 8 merging its China operations with those of telecoms provider TOM Online. In China, C2C platforms encourage buyers to contact sellers so as to build up the necessary trust and confidence to engage in online transactions, as well as negotiate product, financial and logistical details. In this article, we focus on the way C2C platforms compete and in particular how buyers are stimulated to be both aware and trustful of sellers through buyer-seller communication channels. CONSU M ER-TO-C O NS UME R ( O R C 2C ) Following this introduction, we present brief case descriptions of TaoBao and eBay (China). These descriptions are supplemented with information gleaned from interviews with active buyers and sellers from these two platforms. The significance of the competitive issues is then the focus of discussion, where we also draw in the literature on awareness and trust. Finally, we suggest how the C2C market is likely to develop in China. TaoBao TaoBao (www...
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