(Appendices not included)
eBay should continue to focus on growth and continue to fight off competition from rival
companys. eBay has dominated the U.S. online auction market ever since its creation in 1996.
The current market conditions are changing and eBay must position itself for continued growth.
eBay has met most of its key success factors shown in Appendix 1, but must continue to focus on
them to sustain its current growth. eBay's two fundamental challenges include, continued
growth, and the evolution of the business model.
Growth
eBay's growth this far has been outstanding but with the slowing market conditions eBay
must attract new customers to continue its current growth. eBay has sustained a competitive
advantage in the online auction market, but now must transfer this success to additional
expansion in the international markets. One of eBay's weaknesses as ,hfi*ryrthe SWOT analysis
(Appendix 2) is that eBay has not prepared for the slowing of the U.S. market. With Yahoo
exiting out of some international markets this leaves a larger market segment available for eBay
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to absorb.l
eBay should achieve a competitive advantage over other online retail companies by
continuing to expand into the international markets. The emergence of the Asian and European
markets (due to increased internet access) creates a good opportunity for eBay to assert itself as
the global leader in online retail. By taking advantage of the opportunities to capture the market
early on it will be easier for eBay to introduce new products for continu ed growth.y/
eBay also should consider expanding some of its key categories to capture alarger
market share in that industry. Some of eBay's best categories only capture 1-5 percent of the
total market for that good. For instance eBay's largest auction category (eBay Motors) has less
than a 1 percent market share in the $7.5 billion dollar automotive industry. This represents a
significant growth opportunity for eBay to capitalize on. eBay should also take its next 2 largest
categories (Consumer electronics, and Computers) and combine them to create eBay Electronics
which would be a separate site through eBay, similar to eBay Motors. By creating eBay
Electronics, eBay can focus more on its most popular categories to offer greater product
selection and information on the electronic oroducts that it sells.
Evolving Business Model
Another weakness eBay has shown on the attached SWOT analysis (Appendix 2) is that
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the company has little experience with fixed-price salesYFor eBay to sustain its success they
must eventually offer more fixed-price sales to compete better with Amazon.com and Yahoo.
eBay needs to transfer its competitive advantage in the online auction industry into the area of
The ecommerce industry is growing faster than ever. TJ Maxx needs to start focusing more on ecommerce not only to keep up with competition, but also to make sure they do well during weak economic periods. ecommerce, overall, tends to do very well during lackluster economic times. TJ Maxx will be able to cut costs more easily the more they expand their ecommerce business. Our business idea will allow them to expand their ecommerce as we will take over their website and delivery. TJX Companies’ three ecommerce sites accounts for only about 1.0% of the company’s total sales. However, the online channel is a key growth driver and TJX is taking initiatives to improve its online business. The ecommerce sales
Inventory would no longer be a good option for them since holding inventory in a rather quick selling environment is deem bad for the company, showing inability to sell based on consumer demand and has to pay inventory cost. They would also need to implement and focus more on consumer demand, increasing the need to hire market researchers and so on to evaluate the right amount of products to supply. Great customer service will be required in order to satisfy large amount of end users rather than just dealing with a few B2B
Additionally, brand equity, the company’s reputation, and Best Buy’s internet presence and website are also valuable intangible resources. In fact, the article mentioned that Best Buy has the 11th largest e-commerce website worldwide. Best Buy’s core competency lies within the company’s focus towards “customer-centricity attained thorough the in-depth data analysis and systematic customer segmentation.” To restate that, Best Buy differentiates themselves from their competition by providing expert advice and service at prices that compete with competition.
The idea of supply and demand tends to benefit the company when demands are limited. When items are rare and limited companies have a higher ceiling to price products because the consumer is willing to pay more. On websites like Ebay consumers always pay more than retail price showing that the demand is even higher. All sorts of factors such as limited quantities on released dates or limited new products of much wanted products cause the demands. The people are always looking for the next best thing so the demand for it is there even before the product is created and released.
Currently majority revenue is generated by store sales but online sales from the stores’ websites are increasing. With US dollar getting weaker, international sales from these US based websites are increasing too. This creates significant positive outlook for the large incumbent players but also acts as a significant barrier of entry for new players.
and is especially popular among eBay customers. Fig.1 briefly illustrates Company’s business. The system enables its
...e has been registering products on its platform for a long-time, but has assembled out a far-reaching offering with its search results called Google Shopping. And it’s placing advertisements on these product listings by merchants, which takes away promotion dollars and consumer shopping dollars from Amazon. In addition, minor competitors like Groupon are getting concentrated traction in their own e-tailing endeavors with Groupon Goods” (Faruk, 2013).
Eads, Stefani. "Why Amazon's Board is Part of the Problem." BusinessWeek online. http://www.businessweek.com/bwdaily/dnflash/apr2001/nf2001044_127.htm ; April 4, 2001, pages 1-5.
This way the market domination could continue. If they fail to meet the increasing demand buyers can look for other
...oes not dominate the entire market. The Chinese market is so large that even an e-commerce giant like Alibaba is unable to capture the entire market. Here are some other players who are in the market as well:
Online Auction e.g. eBay. In common with new online retail brands, before the emergence of Internet technologies, this concept was not possible. Essentially eBay is a Consumer-to-Consumer (C2C) business. For more information on how online auctions work, see the lesson on eMarketing and price.
EBay is an American internet based co-operation with its main headquarters in California. It was first set up in 1995 and has become one of the world’s most successful companies ever with ebay.com being the company’s main area of focus. Ebay.com is an online auction and shopping website where people and business have the opportunity to sell and buy goods and services worldwide.
During early days of its establishment, Amazon appeared as an online retailer of books only. However, with the passage of time, the company expanded its operations rapidly in music and movies. Market reputation and popularity ultimately made Amazon the biggest online retailer of electronics and household goods. This rapid expansion has made Amazon "Earth's Biggest Selection" of cost-effective products (Dennis and Harris). As an online marketplace, Amazon is enjoying a revenue stream without needing any warehouse to keep the product stock.
Eule, A. (2013). It’s time for Amazon to open its black box. Barron’s, 93(42), 37.
has grown into a $49.7 billion corporation by clearly focusing on the goal of enabling commerce around the globe.