Ebay Case Study

1356 Words6 Pages
1.0 INTRODUCTION This report will attempt to critically analyse and assess the internal and external factors which effected the strategic decisions made by eBay. These strategic decisions consisted of the acquisitions with Skype and PayPal coupled together with an analysis on why eBay failed may have failed in expanding their online presence in eastern parts on the globe such as China. 2.0 BACKGROUND EBay is an American internet based co-operation with its main headquarters in California. It was first set up in 1995 and has become one of the world’s most successful companies ever with ebay.com being the company’s main area of focus. Ebay.com is an online auction and shopping website where people and business have the opportunity to sell and buy goods and services worldwide. 3.0 THE INTERNAL AND EXTERNAL ENVIRONMENT E-marketing is a fast growing and rapid platform for any form of business. EBay has been highly successful over recent years and this is a perfect example of an online business. The internal and external environments are constantly changing and in order to keep up with these changes, businesses and organisations must make relevant changes, and generate new strategies to keep up with contemporary developments in e-marketing and to also maintain their position in their market in comparison to their competitors. The strategic decision to form an acquisition with Skype in 2005 was made and the deal was said to be worth $2.6 billion. It is argued by eBay that with Skype it is able to create an “un-paralleled e-commerce engine”. This acquisition was a follow up of purchasing PayPal in 2002. Acquiring these prominent companies has allowed eBay to forge greater links on order to dominate specific regions of the world. Thes... ... middle of paper ... ...ount of untrustworthy and reliable sellers. EBay could counteract this problem by implementing a strategy where eBay would have the authority to terminate a user’s account if their rating in percentage dropped below 60%. This strategy may help the organisation to reduce the amount of unreliable seller resulting in a much more safer and reliable market platform where people would be able to purchase products at ease without any hassle. 6.0 CONCLUSION In light of the analysis made above; an attempt has been made construct a critical analysis of the internal and external environment which influenced eBay’s strategic decision to form acquisitions with Skype and PayPal along with its performance in eastern countries. These factors were supported through various forms of research and background reading in order to support the validity of the points raised in this report.

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