- What source of competitive advantage does eBay have, and is that position supported by its resources and assets? (Chapter 3)
eBay is a renowned business organization that allows people from diverse parts of the world to perform business transactions online. eBay is today regarded as one of the world’s successful online marketplaces with over 150 million active buyers and sellers (Peragine 1). However, the advent of new technologies has led to the establishment of many business organizations that also utilize the digital platform in selling and purchasing of goods and services. eBay continues to thereby experience stiff competition from its business competitors offering quality online services to millions of its customers. Nevertheless, eBay has been able to cut an edge over its fierce competitors by employing an array of business strategies. eBay continues to grow and thrive amidst the current harsh and competitive business environment as it is endowed with the necessary strategic resources. For starters, eBay is equipped with the best technological devices that allow efficient and smooth business operations (Perigine 4). In addition, the organization has erudite employees who are well-versed on how to incorporate and operate the latest digital technologies. The technology experts assist eBay to outperform its competitors by introducing more efficient technologies that allow eBay to improve its quality of services. Furthermore, the organization utilizes a large portion of its capital so as to support and promote latest innovations formulated by the employees. In addition, the organization has invested more in training its employees on the latest technology and marketing skills. This has allowed employees gain the necessary knowledge and hone their skills. Through this, the employees are able to provide the customers with high-quality services thereby meeting the customers’ expectations, needs and wants. Over the decades, eBay has created a robust brand name for itself thereby retaining the trust of its loyal customers whilst attracting a vast majority of potential customers. In essence, eBay continues to maintain the top-notch position as the best online market platform because of its outstanding customer services, cooperative relationships with firms such as Yahoo, and its ability to hire, motivate and retain highly skilled employees.
- What is the eBay company’s Value Chain and Business Level Strategies? (give at least 4 main points and the example for each part)
A vast majority of customers are attracted to the services and products offered by eBay because of the value they get from them. The customer value created by eBay has enabled the organization to outperform its competitors. Some of the primary activities that have enabled eBay organization to create value for its buyers include; the creation of efficient payment system, generation of web traffic, conversion of web traffic into buyers and sellers, buying process, and peer review post-purchase service. On the other hand, some of the support activities that have added value for the customers include; the organization’s infrastructure, the human resource management, development and advancement of technology as well as effective procurement. Through its value chain model, the company has been able to expand its online presence, make alliances with international organizations like StubHub, and introduce new payment scheme such as PayPal (Peragine 65).
In addition to the value chain strategies, eBay has created its own business strategy that has been instrumental in promoting business growth whilst maintaining a competitive advantage against many organizations. The business level strategies employed by eBay has been categorized into three key areas namely; differentiation, cost leadership, and growth strategy. In the differentiation sector, eBay has sought peer reviews and created alliances with other organizations in different parts of the world. The cost leadership strategy by eBay has been done by introducing a wide range of products to the customers who would be able to choose their most preferred and cost-effective products. eBay had also formulated an effective growth strategy where the organization continues to expand its territories by forming collaborations with different international companies all over the world. eBay’s continues to shift its business strategies in order to enhance user experience with the ultimate goal of introducing machine learning services technique.
Peragine, John N. Ebay Income Advanced: How to Take Your Ebay Business to the Next Level-for Powersellers and Beyond. Ocala, Fla: Atlantic Pub. Group, 2009. Print.