Ebay Case Study
Ebay Case Study
Ebay Case Study
SUBMITTED BY
SADIYA RAFAT (22CMMCA118)
PARMEET KAUR (22CMMCA120)
SUBMITTED TO
DR. MOHD. SHAHID
(Associate Professor)
Department of Commerce
Aligarh Muslim University, Aligarh
(2022-23)
Acknowledgment
We would also like to thank our colleagues, for their willingness to share their
ideas and help us with the report. Their contributions were essential to the
completion of this project.
Finally, we would like to thank our family and friends for their unwavering
support. Their encouragement helped us to stay motivated and focused.
Sadiya Rafat
Parmeet Kaur
Table of contents-:
1. Introduction
2. Historical background
3. eBay’s mission, vision, and values
4. eBay’s organizational structure
5. eBay’s key products and services
6. eBay’s competitive landscape
7. Business model of eBay
8. Revenue model of eBay
9. SWOT analysis
10. Conclusion
1. Introduction -:
E-commerce, sometimes referred to as electronic or online commerce, is the practice of purchasing
and vending products and services via open networks or the Internet. Therefore, any transaction
involving money, funds, or data is regarded as electronic commerce. E-commerce, then, can be
defined in a variety of ways. A variety of e-commerce platforms exist, including Amazon, Flipkart,
eBay, Myntra, and others. eBay is one of the e-commerce platforms available.
eBay is an American multinational e-commerce company based in San Jose, California, that
facilitates consumer-to-consumer and business-to-consumer sales through its website. eBay is a
multibillion-dollar business with operations in about 32 countries, as of 2019. The company
manages the eBay website, an online auction and shopping website in which people and businesses
buy and sell a wide variety of goods and services worldwide. The website is free to use for buyers,
but sellers are charged fees for listing items after a limited number of free listings, and an additional
or separate fee when those items are sold.
Founded in 1995 by Pierre Omidyar, eBay was considered a pioneer in the online auction industry
whereby people are brought together on a local, national, and international basis to serve the
purpose of creating a person-to-person community where individuals could have equal access
through the same medium which is the Internet. eBay is now a publicly-owned company, with the
majority of its shares held by mutual fund holders at 49.23%. The Vanguard Group, Inc. is the
largest institutional shareholder with a 10.77% stake, followed by BlackRock Fund Advisors with
5%. Individual stakeholders own 11.33% of eBay, while other institutional holders own the
remaining 39.83%
2. Historical background -:
Auction Web’s initial focus was on personal collectibles, and the first item sold was a broken laser
pointer for $14.83. Canadian Mark Fraser purchased the first item that eBay founder Pierre
Omidyar listed on the site in 1995 – a broken laser pointer.
In 1996, Jeffrey Skoll joined Omidyar as the company’s first president, and together they began to
expand Auction Web’s reach and services. The company officially changed its name to eBay in
1997, drawing inspiration from Omidyar’s consulting firm, Echo Bay Technology Group.
eBay’s growth accelerated rapidly as the internet became increasingly popular. The
company’s auction format, which allowed buyers to bid on items, created excitement and
engagement among users. eBay’s vast selection of goods, ranging from electronics to collectibles
and automobiles, further fuelled its growth.
In 1998, Meg Whitman joined eBay as CEO, bringing her expertise in marketing and brand
management. Under Whitman’s leadership, eBay went public in 1998, listing its shares on
NASDAQ under the symbol EBAY. This marked a significant milestone for the company and
cemented its position as a leading e-commerce player.
Throughout its history, eBay has made several notable acquisitions that have contributed to its
success. In 2000, eBay acquired PayPal, a secure online payment system, which became a critical
component of its transaction process. Other notable acquisitions include Skype (2005),
Shopping.com (2006), and StubHub (2007).
eBay’s global expansion has been another key driver of its success. The company has established
operations in over 190 markets worldwide, enabling buyers and sellers from different countries to
connect and exchange goods and services.
eBay has also embraced technological advancements to enhance its platform and user experience.
In 2008, eBay launched its mobile app, providing users with a convenient way to shop and browse
listings on the go. eBay has also introduced innovative features such as eBay Live, which offers a
live shopping experience with real-time auctions and product demonstrations.
eBay’s mission, vision, and values serve as the guiding principles that shape the company’s decisions,
actions, and overall direction.
Mission Statement:
“We connect people and build communities to create economic opportunity for all.”
This mission statement encapsulates eBay’s core purpose of fostering connections between buyers
and sellers, driving economic growth, and empowering individuals through e-commerce.
Vision Statement:
“We will build on our powerful strengths to become the best global marketplace for buyers and
sellers through a technology-led reimagination.”
This vision statement outlines eBay’s ambition to become the premier global marketplace,
leveraging technology to enhance the shopping experience and solidify its position as a leader in
e-commerce.
Core values-:
• Customer-focused: eBay prioritizes the needs and satisfaction of its customers, both buyers
and sellers, striving to deliver exceptional service and a seamless shopping experience.
• Promote Inclusion: eBay fosters an inclusive and diverse environment, welcoming people
from all backgrounds and empowering them to participate in the e-commerce marketplace.
• Act with Integrity: eBay upholds ethical principles and conducts business with
transparency, honesty, and accountability.
These core values form the foundation of eBay’s corporate culture and guide its interactions with
customers, partners, and employees. By adhering to its mission, vision, and values, eBay strives
to create a thriving e-commerce ecosystem that benefits all participants.
4. eBay’s organizational structure-:
eBay is a global online marketplace that connects buyers and sellers. It is one of the largest and
most popular online marketplaces in the world, with over 182 million active buyers and over 1.4
billion listings. eBay offers a wide variety of products which include -:
Fashion: eBay offers a wide selection of fashion items for men, women, and children, including
clothing, shoes, accessories, and more.
Collectibles: eBay is a treasure trove of collectibles, including antiques, coins, stamps, trading
cards, and more.
Home & Garden: eBay has a wide variety of home and garden products, including furniture,
appliances, décor, and more.
In addition to its marketplace, eBay also offers several services to help buyers and sellers,
including:
eBay Stores: eBay Stores are customizable online storefronts that allow sellers to showcase their
products and brands. eBay Live: eBay Live is a platform for live auctions and events. eBay
Refurbished: eBay Refurbished is a program that offers certified refurbished electronics. eBay
Motors: eBay Motors offers several tools and resources for buying and
selling cars. eBay Charity: eBay Charity allows buyers to donate a portion of their purchase
price to their favorite charity.
eBay is constantly innovating and adding new products and services to its platform. It is a valuable
resource for both buyers and sellers, offering a wide variety of products, services, and tools.
5. eBay’s competitive landscape
The top eBay competitors are Amazon, Alibaba, Walmart, JD, Priceline, Rakuten, Zalando, and
others. eBay is ranked position 306 on Forbes with a Market Capitalization of $22.82 Billion.
1. Amazon: Amazon is the largest online retailer in the world, and it offers a wide selection
of products, including electronics, apparel, books, and home goods. Amazon is also known
for its fast shipping and easy returns having $513.96 billion of revenue as of 2022.
2. Walmart: Walmart is a large retail chain that also operates a popular online marketplace.
Walmart is known for its low prices and its wide selection of products having $572.75
billion of revenue as of 2022.
eBay was originally merely an online auction website where sellers listed their products for bidding
and the highest bidder got the products. With time, eBay has evolved into an online e-commerce
marketplace platform that enables both C2C and B2C transactions. The platform doesn’t own any
inventory. It simply acts as a mediator between buyers and sellers – enabling people to buy or sell
their items.
1. Sellers-:
Firstly, sellers will register on the eBay platform to begin listing their products on the platform.
While listing, the platform enables sellers to add product images, product descriptions, prices,
shipping details, and other related things to make products appealing to buyers.
• Auction-Style Listings
Some listings on the platform are auction-based where the item is sold to the highest bidder. In the
auction-style listing, sellers also need to mention the minimum bidding price, the duration of the
bidding window, and available payment options.
eBay now provides the option to sellers to open their stores on the platform, with some additional
tools to promote your brand or business.
2. Buyers-:
Like sellers, buyers will register on the eBay platform to start bidding or buying the items through
the platform. eBay offers two ways to buyers for buying a wide range of products. The first one is
the bidding option and the second is the Buy It Now.
• Buy It Now
In this option, buyers simply pay the fixed price set by the sellers to purchase the product. eBay
marketplace platform also offers shopping features such as a shopping cart for buyers to store their
favorite items temporarily and buy them later.
Moreover, eBay enables buyers to keep track of their purchase history and can save their searches
as well.
That’s how eBay works for both buyers and sellers – a platform business model that has made
eBay a well-known online marketplace worldwide.
7. Revenue model of eBay-:
eBay marketplace platform makes money in several ways. Let us have a look at
1. Listing Fee Model eBay enables every type of seller to list a minimum of 200 products
on its online marketplace platform free of cost. Once the limit is exhausted, eBay charges a listing
fee (or insertion fee) of $0.35 for each listing.
3. Advertising-Based Revenue Model eBay doesn’t earn revenue just via listing fees or
commissions upon successful sales. The platform allows sellers to advertise their products on
eBay in trade for money. To advertise on eBay, sellers have to pay a fixed amount.
In addition to these revenue models, eBay brings significant revenue from international trade and
through its acquisitions of leading companies such as StubHub.
8. SWOT analysis -:
Strengths-:
Strong brand recognition: eBay is a well-known and trusted brand with a global customer base of
over 187 million active buyers. This strong brand recognition helps to attract new customers and
sellers to the platform.
Large and diverse marketplace: eBay offers a wide variety of products and services across
numerous categories, making it a one-stop shop for users looking to buy or sell items contributing
to a dynamic and thriving marketplace.
Global reach: eBay operates in over 190 markets around the world, giving it a wide reach and
access to a large potential customer base.
Scalable technology platform: eBay’s technology platform can handle a large volume of
transactions and is scalable to support future growth.
Experienced management team: eBay has a team of experienced executives with a proven track
record of success in the e-commerce industry.
Weaknesses-:
Complex pricing structure: eBay’s pricing structure can be complex and confusing for some users.
This can make it difficult for sellers to price their items
competitively and for buyers to compare prices.
Dependence on third-party sellers: eBay is heavily reliant on third-party sellers to provide the
products and services that it offers. This can make it difficult for eBay to control the quality of the
products and services that are offered on its platform.
Declining growth rate: eBay’s growth rate has been slowing in recent years, as competition from
other e-commerce platforms has intensified.
High operating costs: eBay’s operating costs are high, as it must invest heavily in technology and
marketing. This can make it difficult for eBay to generate profits.
Opportunities-:
Growth of e-commerce: The e-commerce industry is growing rapidly, and eBay is well-positioned
to capitalize on this trend.
Expansion into new markets: eBay has the potential to expand into new markets, both domestically
and internationally.
Development of new products and services: eBay can develop new products and services to attract
new customers and sellers.
Partnerships with other companies: eBay can partner with other companies to expand its reach and
offer new products and services.
Threats-:
Competition from other e-commerce platforms: eBay faces stiff competition from other e-
commerce platforms, such as Amazon and Alibaba.
Changing consumer preferences: Consumer preferences are constantly changing, and eBay needs
to adapt to these changes to remain competitive.
Economic downturn: An economic downturn could hurt eBay’s business, as consumers would have
less money to spend on discretionary purchases.
Cybersecurity threats: eBay is a target for cyberattacks, and a successful attack could damage its
reputation and business.
Conclusion -:
eBay understands to keep its competitive edge and make it sustainable in the long run, the company
must capitalize on developments at the corporate, organizational, and business levels. As
evidenced by the tactics outlined, eBay accepts the five building pieces that have been randomly
used throughout eBay’s history: improvisation, co-adaption, regeneration, experimentation, and
time pacing. The corporation also adheres to the ten principles of competing on the edge in terms
of strategy, organization, and leadership.
The security department should work more to reduce the risk of Internet fraud; this is one aspect
of online business transactions that turns consumers off from purchasing online because no one
wants their money to end up in the wrong place after they have paid for an item or product.