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Copy of ebay Strategy

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Caroline Cherian

on 7 November 2012

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Transcript of Copy of ebay Strategy

Case study - Strategy of III. Business characteristics
of the
online auctions industry I. Executive summary Main competitors PORTER analysis VI. Changes in the market V. Key driving forces IX. Key issues and challenges VII. Strategy of the Group VIII. Key success factors X. Alternatives XII. Implementation Table weight XIII. Contengency plan XIV. Conclusion Thank you for your attention Alexandra BRELIVET
Caroline CHERIAN
Benoît CONAN
Marvin NDOE - Brand name
- Large number of subscribers
- Easy process of auction and buying
- Community of interest
- Peer review
- Advertising (Skype)
- Customer service
- Technical assistance
- After-sales service
- Security of payment (Paypal) - Not enough sellers regarding to the huge number of buyers
-Increasing number of fixed price sales over online auctions
- Security of the auction process and the payment
- Fraud
- Necessity to accommodate power sellers (businesses) - Positioning on the market
- Specialization
- Growing dissatisfaction among small sellers
- Expansion of the types of sellers
- Transition to professional management
- Manage the fall of net transaction revenues in the core marketplaces division (including online auctions)
- Fixed priced sales Positioning - Extensive offering of products in different categories
- Brand name is synonymous with online auctionung
- eBay is reputated as a safe company for online payments (Paypal) Strategy group analysis INDIVIDUAL AUCTIONS AND ONLINE STORES :
> to remove physical barriers between buyers and sellers

> to create added value through base of additional information

> to make the customer confident Major conclusion Presentation of the company Purpose of the study Tools used II. Problem statement XI. Recommendations Strategic and Financial Objectives Choice and justification
Table weight - Founded in 1995 by Pierre Omidyar
- 15000 people employed and 5,9 billion $ revenues in 2008
- More than 276 million members registered on the website in 2009 *Innovative way of trading

*Vertical to horizontal integration

*An industry in growth phase

*Market dominated by some companies

*Profit generated by the e-business III. Strategy-shaping business characteristics in the industry *Segmentation of the industry

*Channel of distribution

*Safetyness of the transactions

*Recent changes in the market
(more and more competitors) - A Globalized market

- A market in strong growth

- Development of the technology

- New customer uses

- Same products How can eBay renew its business model
in order to be more profitable ? 1/ Diversification :
Ebay can develop new markets by diversifying its activities (through acquisitions and implementations of products) 2/ Expansion - have more users and make more profit through fixed prices
Ebay can develop a new business model by mixing bidding prices and fixed prices, and change the fees paid by the sellers 3/ Customer loyalty :
The company could offer better and more secure services which should lead to a key competitive advantage - Develop new markets through acquisitions - Extend its number of categories by implementing new products This strategy is based on long-term view and return on investment. - Sellers would have to put a fixed priced in addition to the auctions - The commission fees would be lower if the sales deals with a sell by auction and higher with a sell by fixed prices - eBay would manage the delivery system - A policy which would tackle the issue of fraudulent activities - A change in the evaluation rate concerning the relationships between buyers and sellers SWOT IV. Competition analysis How to maintain eBay's favorable position in a high competitive market and global crisis context. - PESTEL
- Strategic group map
- Table weight
Increase the number of seller (professional and particular):
- By adapting the fee system (small decrease on the fee to the power sellers (professional) and simplify the rate system )

Increase the numbers of buyers:
- For every product in auction, the seller must fix a fixed and an immediate price for each item Win market share and become the reference in online retail by increasing the number of users : How: Evaluate the fee system, Schedule the change, Prepare the change of the Business Model by different studies

When: 2 months of Planning, 3 months of Implementation, Testing and Adaptation

Who: Sellers (Professionals and Private individuals) and Buyers

How much: The mall decrease of the profit on professional sellers is compensated by more profit thanks to the fixed prices

What risk: The community doesn’t like the new system and doesn’t recognize itself in the new strategy

How to minimize the risk: Prepare the change with studies, Evaluate for each user the best fee, Prepared the change with the professional sellers Strategic and Financial Objectives:

- Improve the website and quality of existing services in order to gain and the develop the loyalty of the users

But in return, to compensate the increase of cost, we must increase the fees. Key elements to focus on in order to survive in the competitive world
of online retailing :

- Brand image
- Simplicity of the website and the selling system
- Community interest
- Innovation and anticipation eBay has to win marketshares and become the reference in online retailing by increasing the number of users
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