Strategic Plan for eBay
Introductory Statement
Samantha Cowan formulated a new strategic plan for Brandon Cohen, Courtney Sloan, and Alex Petukhov to help eBay expand to new horizons and maximize profits leveraging eBay's reach. Moving entirely away from the online auction site and dramatically changing the business model, eBay will expand value and low cost price point to an already vast worldwide network. In direct competition with other large online marketplaces, eBay will leverage its worldwide reach to strategically compete at a lower margin while charging its sellers lower fees and delivering significant returns for its shareholders.
E-commerce-hosting platforms, like Shopify and Squarespace, are carving out their own substantial businesses by helping retailers set up online shops and using social media to attract customers. eBay will have to make dramatic changes to continue succeeding in the future. Focusing on small and medium-sized organizations and specific products, eBay will now leverage certain small-scale sellers. They will have a brighter future in a wired world if the company can identify appropriate niches (Bakos, 2001).
Background Statement
eBay was founded in September 1995 by Pierre Omidyar and was initially known as AuctionWeb. The website was dedicated to bringing together buyers and sellers in an honest and open marketplace (eBay Inc., 2019). eBay originally served as an auction site where sellers listed products and buyers bid on goods. The products then got sold to the highest bidder. In recent years, online marketplaces like Amazon have gained increasing popularity. An online marketplace is an e-commerce website where third-party vendors sell various products. The marketplace does not own any inventory; rather, they present a collection of other people's goods and facilitate transactions (Kestenbaum, 2017).
While eBay acts as a marketplace, buyers must bid on items and be the highest bidder to purchase the product. The auction-style design of their service is dated, so eBay will be restructuring its business strategy to capitalize on profits by eliminating the auction feature to keep up with current demand. The company will switch to having sellers list the cost of their products and remove the bidding process. Premium products will be offered for sale by various sellers ranging from individuals to large companies at an economical price. Eliminating the auction aspect of the website will allow eBay to source higher-quality products to appeal to a more substantial target market.
Additionally, eBay will implement a new system that allows customers to receive store credit for future purchases. The company seeks to encourage the reuse and recycling of their products, so they will be offering a program where customers can return used goods, such as electronics, apparel, toys, etc. to obtain credit towards future purchases. These used goods will then be recycled or repurposed by eBay. This ends up be...
