4. Strategic recommendations on International Commercial Strategy for eBay.

As a result from operations in China, there were some lessons to be learned from the unfavourable result of the so-called alliance of eBay and EachNet:

* Think globally, act locally – cultural differences can create a strong constrain with the customers and it is necessary to adapt to the local market and its preferences. * Never underestimate your opponent – eBay was outperformed by its competitors that were able to satisfy customers’ needs. * A good name does not always do the trick – in order to win over customers, you need to have a good history in China. * Mature markets vs. emerging – eBay strategy, which proved itself in mature markets, may not be appropriate in emerging, developing markets. This requires eBay to revise its strategy and conduct an in-depth research in terms of customer behaviour and cultural differences.

In order to better evaluate the best international commercial strategy for Ebay we have developed a QSPM matrix. We discussed and evaluated two possible strategies: further expansion into international markets or expand operation into B2B market.

Quantitative Strategic Planning Matrix Nr | Key factors | Expand further into international markets | Expand operations into B2B market | | Opportunities | Weight | AS | TAS | AS | TAS | 1. | Growing internet usage, more than 420 million people use internet | 0.07 | 4 | 0.28 | 2 | 0.14 | 2. | Generation X and Y entering the workforce | 0.02 | 0 | 0.00 | 0 | 0.00 | 3. | Improving markets in emerging countries | 0.03 | 4 | 0.12 | 3 | 0.09 | 4. | US and Mexico exceede $3 trillion in online sales in 2003. | 0.04 | 4 | 0.16 | 3 | 0.12 | 5. | Expected growth of e commerce in Latin America $82 billion in 2004. | 0.03 | 4 | 0.12 | 3 | 0.09 | 6. | Growing popularity of internet auctions |