Ebay Research

Background

eBay was founded in September 1995 by Pierre Omidyar in San Jose, California as AuctionWeb. The very first item ever sold on eBay was a broke laser pointer for $14.83. eBay is a global online marketplace where buyers and sellers transact goods and services worldwide. They have a global presence in 39 markets and approximately 276 million registered users worldwide, "eBay Inc. connects hundreds of millions of people around the workld every day, empowering them to explore new opportunities and innovate together. eBay does this by providing the Internet platforms of choice for global commerce, payments, and communications." (ebay.com) John Donahoe is the President and CEO of eBay Inc. He became President and CEO on March 31, 2008, succeeding Meg Whitman, who stepped down from the role after ten years, and who continues to serve on the company's Board of Directors. "John came to eBay in February 2005 as President of eBay Marketplaces, responsible for all elements of eBay's global ecommerce businesses." (ebay.com) Currently, eBay's stock price is $30.87 per share.

External Factors

Substitutes- There are several substitutes to buying on eBay. For example, instead of going through the hassle of buying online, a buyer could just go to a regular store to buy what they are wanting. Another substitute for eBay would be a traditional auction. Also, there is an increasing number of fixed price sales over other online auction sites. Search engines and price comparison websits are moving into online retailing and auctions which could be a potential threat. I would definetly consider substitues as a negative for eBay.

Rivals- The online auction market has changed alot since its beginnings. More and more competitors from different backgrounds are entering the market. Many search engines are coming about and trying to sell as auction sites now too. Rivalry would be a negative for eBay.

SWOT Analysis

Strength- EBay is the leading provider of online auction and customer-to-customer trading in the world. They have many competencies, core competencies, and distinctive competencies that set them apart from their competitors. Their alliances, international dominance, and recognizable brand, name just to name a few, are some of the main reasons why eBay is a company that is hard to top. It is capable of attracting vast audiences with diverse needs. A recognizable brand name is important to the success of a company. eBay has made sure to use color and unique writing to show their brand name off. They also use television and Internet advertising to get continued publicity on different media avenues. Amazon.com does not have as much face value as eBay. Their name is not distinctive to the customers like eBay’s.

The company used the power of customer relationship management by collecting data of buyers and sellers registered with the company. This is a huge strength of the company because the data collectd can generate reports and statistics that can make the company better address its weaknesses and threats. eBay gives a whole new meaning to the word middle man business by providing tools to sellers which let the seller target their products to buyers in their market. It also provides buyers with great search tools to get the products they are looking for. eBay has a powerful platform for both buyers and sellers by being seamless and invisible buy at the same time facilitating Customer to Customer relationship. Diversifying has been a key policy of eBay. It does this by not only diversifying its products but also its market by branching and localizing in countries lie India, China, and the U.K. Staying ahead of the competition has always been a focus of eBay. A great example would be the acquisition of Paypal to support its online auction with a robust payment method.

Weaknesses- eBay does not do a very good job of controlling illegal or fraudulant auctions. There are numerous auctions out there whose purpose is to scam buyers. Another weakness of eBay is that sellers are able to enforce the payment method of their choice. Shipping has been a large problem while shopping with eBay. Sellers have been raising shipping costs and reducing item costs. This had lead to buyers fleeing to retail stores for better deals. Another weakness of eBay is its inability to control the contents of auction items. Most content is