분야
doc1. Brief history of eBay
2. Current situation
II. External Analysis
1. e-commerce
2. Online payment system
3. e-communication
III. Internal Analysis
1. Strength
2. Weakness
1) US originated culture: Garage sale
2) No innovation
IV. Action Plan
1. Current strategy of eBay
1) Concentrate subsidiaries into related business
2) Follow actively the trend of e-commerce industry
3) skype enlargement
2. Suggestion
1) Concentrating on e-commerce
- Historical strength
- No other choice due to lack of innovation ability
- eBay users
- Google users
- Cheap price
- Fast delivery
- Easy payment service
2) Globalization with localization
Reference
1. Brief history of eBay
- The world biggest online auction company with 20 M users in more than 150 countries.
- .com company continuously going into the black since 1996
- The most popular online shopping website with the longest time of users’ stay
eBay Inc. (eBay) is one of the successful online business corporations. The very beginning of eBay goes up to 1995. Pierre Omidyar founded Auction web. In 1997 the name was changed to eBay. They were one of few who had survived from .com bubble in late 1999 and since 2001 they proceeded new strategies – began to buy several online retail sites including mercardo.com from South America and auction.co.kr from Korea, and PayPal, online payment business, in 2002, and skype in 2005 – Internet phone call service.
2. Current situation
As a result of these buying strategies, three divisions were formed on eBay – e-commerce, online payment, and e-communication. We defined the biggest part as e-commerce, which is including not only auction and open market platform, but also price comparing website (shopping.com) and the web site for building online shopping homepage (prostores.com). After acquiring PayPal and Bill Me Later, these online payment companies not only gave profits to eBay, but also made some synergy effect with e-commerce subsidiaries. On the other hand, skype, which is totally different from main businesses, even though the business itself has been growing fast and quite profitable, they failed to make any synergy at all as they first intended from the ridiculously overcharged acquisition.
Under these circumstances, eBay can be asked these questions: there is no synergy among those three divisions and this might become a poison to eBay in next few years, then what eBay has to do to solve or improve this situation? Should eBay keep these all divisions? If so, are they capable of handling this? In addition to this, last month there was an announcement from eBay that they were going to spin off skype next year. Is this strategy advisable? Shouldn’t they sell skype? If this keeping skype strategy is just about cash flow, isn’t there any other way to get profit except skype? How about the other two divisions? To answer these questions, we provide external and internal analysis.
II. External Analysis
1. e-commerce
We analyzed the special feature of each three divisions. First, e-commerce business, the industry already grew fast, however now, it seems to go down. The online sales growth decreased recently (for more detail, eBay met first decrease in their sales last year. See exhibits 1). As technology is evolving, different types of competitions emerged – not only based on Internet platform, but also via cell phone or other devices. The competitive substitutes are transforming with technical innovation. This might be a huge threat to eBay once they become true rivals as eBay haven’t performed any innovation yet. Also the traditional competitors begin to invest for innovation. For example, amazon.com developed the hardware and software platform called ‘kindle’ for reading e-books and other digital media. This brought a huge success to Amazon in Japanese market where eBay had failed earlier, without serious preparation. But eBay.com is still number one among the traditional competition (See exhibits 2 & 3) and eBay owns more than ten other online shopping websites which are not performing poorly. So this might be the opportunity they can apply.
2. Online payment system
Second, online payment industry is growing fast. Still credit cards are dominant method of online transaction, but the usage of accounts to e-mail (such as PayPal) and deferring billing system like Bill Me Later is growing steadily (See exhibit 4). Unlike the reason of industry growth from e-commerce market, this industry’s growth is based on the number of users and their usage. As eBay has two main players – PayPal and Bill Me Later, the forecast of online payment division is quite promising. To enter this industry, not much technology specialty is needed. As the entry barrier is low, lots of companies got into this industry at the beginning, but since the reliability is key factor to offer money transaction service, the competition is concentrated on major players after all. Then, how about buyer’s power? By using this system, company can gather users’ information. Related to reliability, the switching cost is quite high and substantially, the matter of choice is not in their hands. The primary option is done by websites (companies) so it is more possible that the highly recognized services could be chosen. PayPal and Bill Me Later are representatives of those payment methods and this market situation can be an opportunity to eBay.
3. e-communication
Last, online communication is sort of new business growing rapidly. Tons of sources based on Internet are capable of being utilized, from photos or videos to social
