Analysis, Nature, and Strengths of Competitive Pressures Faced by eBay
Porter’s five forces model analysis reveals that there are many competitors of eBay who are its rivals within the industry. Many e-commerce websites are available which compete excessively against the company and they do anything to take over eBay’s supremacy which it has built over the years. Examples of these companies include Amazon, Alibaba, Google, and Apple among others. A large number of online auction firms indicate the great competition in the auctioning industry ( Ko & Kim, 2017, June) .
The model also shows the demand of customers in which they demand not just offers that are low priced but they also consider the availability of services and products that they desire which are provided by eBay. The analysis also indicates that because of increased websites to auction online, buyers and sellers may identify other websites reducing the use of eBay. The analysis, however, concludes that eBay sells at a faster pace and has a wide range of commodities resulting in no real threat in the model ( Ko & Kim, 2017, June) . eBay moves with the changes taking place in the industry leading to the innovation of items that are strategic to maintain the trend in the market.
Delegate your assignment to our experts and they will do the rest.
The competitive pressures that eBay and other online auction companies face do not have any effect on the profits that those companies make. Each organization usually have its own customers and they make the profits that they expect despite the intensity of the competition they face. The major issue that the companies could face is the margin profit which each company gets would decrease amongst the players.
Issues and Problems that the Top Management at eBay Needs to Address
The company needs to pay more attention to its subsidiaries by linking them all to create a synergy that is powerful. eBay has many subsidiaries and in order to maintain its image, it must make sure that the way they all run is effective. The company also needs to ensure that the feedback forum is reevaluated and well organized to be able to respond to the issues submitted by the customers. The company also need to address the legal issue of PayPal ( Kimball, 2016) . Despite the company having many challenges that it should address, based on the analysis there is a problem relating to the legal challenge to PayPal, new entrants in the market. This challenge is linked to the way players like Amazin have the power to affect the market position of PayPal hence a need to address the issue urgently.
Key Success Factors for Online Auction Firms
Critical factors that auction firms keep in mind are such as, the layout of the website which needs to be easy to use, clear and simple to understand for all kind of customer.
Personalized features is another factor and it requires that they are developed clearly to enable convenience to the user on the online auctions.
Information architecture in which information should be well-organized to allow the user to understand while browsing and looking for a specific item.
Establishing credibility and good reputation is another success factor where an auction website needs to indicate security maintenance a feature of credibility ( Kaushal & Jain, 2017) .
References
Kaushal, T., & Jain, J. K. (2017). Emerging Challenges of Global E-Commerce. INTERNATIONAL JOURNAL , 2 (3).
Kimball, D. C. (2016). Corporate strategies in action: eBay acquires and divests PayPal . SAGE Publications: SAGE Business Cases Originals.
Ko, M. J., & Kim, Y. J. (2017, June). Argument Quality or Peripheral Cues: What Makes an Auction Deal Successful in eBay?. In International Conference on Intelligent Decision Technologies (pp. 357-372). Springer, Cham.
