CH11

 

Case Study

 

1.      Contrast eBay’s original business model with its current business model.

eBay’s original business model mainly focused on auctions. It also consisted of two types of revenue models:

Advertising Revenue Model:

Incur fees on investments Transaction Revenue Model

High listing cost-Low sales commission

In contrast to it’s original business model, eBay’s current business model is more focused on fixed price goods and their revenue is derived from other acquisitions such as PayPal, StarHub, and Gumtree. The current business model also consists of the same two revenue models: Advertising Revenue Model Transaction Revenue Model

Lower listing fee-Higher sales commission-No listing fee for smaller sellers

2.      What are the problems that eBay is currently facing? How is eBay trying to solve these problems?

eBay was faced with the following problems:The first problem that eBay faced was the introduction to the VoIP service which provides free or low cost calls over the internet. eBay’s sellers were not interested in adding voice calls to their business models.The second problem that eBay encountered is foreign affairs. The company was notable to keep up with the different laws in each country. For example, the auction site called Tabaco in China.The next problem was the honesty and integrity of the auction following a customer servicer problem. If they created a customer service department, it would take away from their profits and their investors would be concerned and possibly opt out. In order for eBay to eliminate these problems, they have expanded and added more measures of protection such as purchase protection and vehicle warranties. eBay created a dialogue fort heir consumers to voice their opinions by constructing a section on their website for customer to write their comments. Another attempt eBay took was making sure fraud from the buyer or the seller wasn’t possible by having a more secure system.

3.      Are the solutions eBay is seeking to implement good solutions? Why or why not? Are there any other solutions that eBay should consider?

Yes, because eBay’s market strategies are adapting in order to accommodate the frequent changes in the evolving technologies and internet users. The company has created an identity crisis and had a new focus on the secondary attracted the interest of bulk seller. Tweaked search ordering algorithm favours power sellers. Some other solutions that eBay should take into consideration are: Spin off retail arm, mobile e-commerce, package pickup

 

4.      Who are eBay’s top three competitors online, and how will eBay’s strategy help it compete? Top three competitors: Amazon, Google, Ebid and/or craigslist. eBay’s strategy gives the company as advantage to compete because of the following: The variety of products/services offered, eBay Community, eBay website, eBay’s brand name, and eBay’s global reach.

 

Projects

 

1. Visit one for profit and one nonprofit sponsored social network. Create a presentation to describe and demonstrate the offering at each site. What organizational objectives is each pursing? How is the for-profit company using community building technologies as a customer relations management tool?

National Geographic, originally a non-profit, changed its image in 2015 to a deal with Fox, now in a move by the Disney Corporation it will attempt to bring NatGeo under its umbrella. This business style change however, hasn’t changed some of their core ideals. National Geographic has been bringing the wilds of the untamed world to civilization since 1888. Originally a scholarly journal the magazine now reaches over 40 million each month.

 

2.Visit one of the social networks listed in Table11.1 and compare it to Facebook. In what ways is it similar to Facebook, and in what ways is it different? Which do you prefer, and why?

I chose to compare Facebook to Instagram

Similarities:

Both social networks have a feed, both social networks have “friend options”, both social networks have search, direct message, and “like” features, both social networks allow the user to share photos and videos

 Differences:

Instagram only allows you to post something if you are including a picture; it is not possible to post a text message, Instagram calls friends followers, and someone can follow you without the necessity of following them back, Instagram does not have the option “share”, Facebook has way more activity than Instagram.