Chapter 11

Case Study

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

eBay began as an online auction website that has transformed into a more traditional e-commerce website over the years. The business model used to consist of their customers trying to outbid each other for a variety of items which were rare in the early 2000’s. However, this model slowly changed into a more sensible e-commerce website due to heavy competition from the upcoming Amazon and others. eBay now sells new items which consist of 80% of their listings instead of used products. The company also knew that it couldn’t limit itself so it began to purchase a variety of businesses and developed apps and products that allowed it to survive the lean years.

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

eBay is facing heavy competition, especially from the dominate market holder called Amazon. Their competition possesses almost half of the market and eBay has far less, which isn’t the best considering their current market value. The company also is struggling to keep up with the ever-expanding applications, functions, and products that their competition has access too. eBay is trying to solve these problems by viewing their competitions strengths and implementing them into the company. However, they are also changing their approach into a more e-commerce focused business and also purchasing existing businesses to expand their portfolio.

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

eBay is seeking to improve their platform by things such as the interest feature which allows users to customize their home page through questionnaires and surveys. However, this may hurt eBay in the end due to their customers not fully exploring options and content but instead focus on things that they already have or do not need. Another improvement was switching their search engine to recognize pictures over text. This is a bold move because someone may not have access to the item and instead may want to just perform a common text-based search and may not be entirely accurate. Finally, eBay has cracked down on fraud from both buyers and sellers, which is one of the most common concerns among users and now authenticating items. This is a great move since it improves customer perception of the company, stops lawsuits, and generates revenue for the business.

4.      Who are eBay’s top competitors online, and how will eBay’s strategy help it compete?

Amazon is eBay’s top competitor which possesses almost half of the market and eBay only possess just above six percent. eBay has implemented a program similar to Amazon Prime in Germany called “eBay Plus” which allows the consumer to receive the product in three days or less or get a coupon or full refunds. eBay also created a week-long event that is similar to Amazon Prime Day, which is free without needing to sign up and allows customer to price match. These strategies allow eBay to keep up with their competition and keep their market place percentage steady. However, the company had struggled in 2018, they should be capable with their new-found niche.

Projects

3. Visit one for-profit and nonprofit sponsored social network. Describe and demonstrate the offering at each social network. What organizational objectives is each pursuing? How is the for-profit company using community-building technologies as a customer relations management tool?

Jumo is a nonprofit social network that connects individuals and organizations that have an interest in making the world a better place. These individuals will be able to find worthwhile causes, chat with other non-profit workers, and support operations. They have tabs for each country so that if people want to look into activities then would be able to look into these countries.

Facebook is a for-profit organization who wants to increase their technology and capabilities. They care about their consumers only for the fact that this will keep people coming back and increase their profit. The company uses community-building technologies to connect their users to their advertisers and friends to expose their customers to products and allow them to also converse with friends.

4. Visit one of the social networks listed in Table 11.1 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?  

Myspace was one of the first leaders of the social media platforms that paved the way for current social media such as Facebook. Myspace was originally very popular throughout the world, but during 2008 Facebook overtook the platform at the top of the media. However, there are still some similarities between the two platforms such as customization of profiles, feeds of activities, chats (groups or otherwise), mobile access, and live streaming. However, Myspace has things like a karaoke section, polls, forums, and advertisements from Google and AdSense. Facebook, on the other hand, has included things like apps, live chats, pokes, games, classified section, and much more that separates Facebook from Myspace. Personally, I would prefer Facebook over Myspace because the website is being managed better and there are many more people that use Facebook and not many that even remember their Myspace account.