MARKETING ANALYSIS OF EBAY
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The internet company eBay would seem to have realized the goal of a perfect market where buyers and sellers have access to perfect information about other buyers, sellers and merchandise. Because eBay charges a small fee relative to the price of the products, and because the company does not maintain or manage any inventory of its own, it depends on large volume and low overhead in order to remain profitable. The auction site has also expanded its original vision of merely providing an auction forum to a site where buyers can select a "buy it now" price for many items, and where new items are sold directly to consumers as well as used items. At this point, it is possible to buy items for a few dollars that would otherwise be found at a garage sale, and also entire homes and businesses for millions of dollars. This research examines the marketing strategy of eBay and recommends several marketing approaches that the company should implement in order to realize its long-term strategic objectives.eBay is a company that could not exist without the World Wide Web, and it greatly expanded the way in which consumers and companies think about the Web. eBay succeeded in creating a new business paradigm at a time when the "dot-com" revolution was well underway. Unlike many of the other companies that came into existence at that time, eBay survived and even thrived in the new electronic market, and did so without establishing a physical brick-
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the ways in which these companies reach their end users, and additional distribution channels have been opened as a result.
The company's price strategy has remained relatively fixed throughout its history, with an emphasis on keeping the cost to buyers and sellers low. With items such as shipping left entirely to the two parties completing the transaction, eBay ensures that it receives a small percentage of the transaction costs, but with millions of transactions occurring each month, that small amount adds up. The company's distribution strategy has not changed--it does not have brick and mortar stores, but remains entirely based on the Web. Its promotional strategy has expanded over the years to include television commercials, and its alliances with corporations represented a significant move away from its original position, but such strategy also provides co-operative promotional opportunities that the company has fully exploited.
STRATEGIC ISSUES ANALYSIS
Chief among eBay's critical success factors is its reputation. In the relatively short time that the company has been in business, it has established a reputation for providing a secure site for buyers and sellers. eBay pioneered the use of message boards for buyers
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Approximate Word count = 3500
Approximate Pages = 14 (250 words per page)
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