PEST of Ebay

1. Political

eBay is a company, which is not very much influenced by political developments. Some countries might put some policies affecting them in place and the on-going globalization might have effects on them as well.
Globalization

Globalization is an issue that will positively affect eBay’s business. They will be able to expand internationally and find new markets.
Government Policies

Some government policies in favor and against interests might be introduced. When looking in the past though, national governments have left e-commerce alone.
Regulatory bodies and processes

Regulations could be passed making sites ensure a certain level of security in online shopping, increasing customer security but also costs for online businesses.
2. Economic
Interest and Exchange Rates

A future instability in Exchange rates would have heavy effects on eBay. Interest rates would also be affected by the instability and therefore affect eBay in bad ways.
Economy Situation and trends

Economic situations of course have a direct impact on eBay’s good performance. Another Wall Street crash would probably devastating effects on eBay while a second boom e-commerce would make eBay’s profit rocket.
Taxation

Taxation might affect eBay in two ways. First of all higher taxing of their profit might be possible. Secondly and more importantly if taxation for every sale in online auction houses would be introduced this would seriously damage eBay.
3. Social
Lifestyle Trends

Further integration of the Internet in the daily life will be a major issue in the next years. This is a great opportunity for eBay and will affect them very positively.
Consumer buying patterns

Consumer might develop completely different buying patterns meaning that they might start buying everything online and getting it delivered. eBay could make use of this and find new markets.
Brand image

eBay’s brand image might suffer over time and their competition might then overtake their position as market leader.
Demographics

In some countries the population is becoming older and in some younger. Older generations might not show much interest in a service like eBay while younger generations generally show more interests in innovations. This means that older societies might not be such a market for eBay to aim at.
4. Technological
Consumer buying mechanism

In future buying of products will more and more take place on online platforms. eBay might be able to take advantage of this by finding new markets and increasing their market share.
Innovation potential

If innovations come, which they will, and eBay does no steps towards them, one of their competitors will do so and maybe even inherit eBay’s position as market leader.
Patents

eBay might be confronted with further patent or licensing issues, which can do them major harm. In very bad cases this could mean that eBay’s earnings are cut down to large percentages because they go to patent owners.

Ebay's 5 forces frame work

Porter's Five Forces

A MODEL FOR INDUSTRY ANALYSIS

The model of pure competition implies that risk-adjusted rates of return should be constant across firms and industries. However, numerous economic studies have affirmed that different industries can sustain different levels of profitability; part of this difference is explained by industry structure.

Michael Porter provided a framework that models an industry as being influenced by five forces. The strategic business manager seeking to develop an edge over rival firms can use this model to better understand the industry context in which the firm operates.

What is Porter's five forces by Wiki

Porter's five forces is a framework for the industry analysis and business strategy development developed by Michael E. Porter of Harvard Business School in 1979. It draws upon Industrial Organization (IO) economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market. Attractiveness in this context refers to the overall industry profitability. An "unattractive" industry is one in which the combination of these five forces acts to drive down overall profitability. A very unattractive industry would be one approaching "pure competition", in which available profits for all firms are driven down to zero.
Three of Porter's five forces refer to competition from external sources. The remainder are internal threats. It is useful to use Porter's five forces in conjunction with SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats).
Porter referred to these forces as the micro environment, to contrast it with the more general term macro environment. They consist of those forces close to a company that affect its ability to serve its customers and make a profit. A change in any of the forces normally, requires a business unit to re-assess the marketplace given the overall change in industry information. The overall industry attractiveness does not imply that every firm in the industry will return the same profitability. Firms are able to apply their core competencies, business model or network to achieve a profit above the industry average. A clear example of this is the airline industry. As an industry, profitability is low and yet individual companies, by applying unique business models, have been able to make a return in excess of the industry average.
Porter's five forces include - three forces from 'horizontal' competition: threat of substitute products, the threat of established rivals, and the threat of new entrants; and two forces from 'vertical' competition: the bargaining power of suppliers and the bargaining power of customers.
This five forces analysis, is just one part of the complete Porter strategic models. The other elements are the value chain and the generic strategies.^{[citation needed}

Ebay mission statement and vision statement

eBay mission statement:
eBay's mission is to provide a global trading platform where practically anyone can trade practially anything.

eBay vision statement
eBay inc. pioneers communities built on commerce, sustained by trust, and inspined by opportunity. eBay brings together millions of people everyday on a local, national and international basis through an aray of websites that facus on commerce, payments and communities.

Competiter, Amazon vision statement
The vision is to be earth's most customer certric company; to build a place where people can come to find and discover anything they might want to buy online.

eBay strategy
^{eBay Strategy}

·                        A place to buy. Get nearly anything you need or want at prices better than you can find in traditional brick-and-mortar or even online stores. Though there are lots of rotten deals on eBay, too, the careful consumer can always come out ahead.

·                        A place to sell. Whether you're a bix-box retailer or just an average Joe (or Jane) cleaning out your garage, nearly anything you list on eBay will sell if you're flexible enough about the price. eBay's global reach can even move unusual items that aren't in demand in your own neighborhood, turning paperweights into cash.

·                        A place to shop. Because of the immense variety of things that can be found for sale on eBay, many members have discovered that eBay is one of the best places in the world to window or comparison shop. Item listings often include photos, detailed descriptions, and owner experiences. Because you can see lots of the same item side-by-side in various conditions and know what each one sold or is selling for, eBay gives you insight into the real market value or "street value" of most types of goods around the world.

·                        A place to collect. eBay is the world's largest marketplace for rare, discontinued, collectible, or hard-to-find items, no matter what the type or price. Whether you're looking for turn-of-the-century box cameras, hand-made Victorian doilies, Soviet army service medals, or 1980s vintage arcade games, eBay will give you a better selection than just about anyone else anywhere.

·                        A website. There is no physical eBay store. Founded in San Jose but now operated from several cities, eBay's service exists entirely online, and all aspects of business other than the delivery of bought and sold items themselves are typically handled through the eBay website.

·                        Free for buyers and inexpensive for sellers. It costs nothing to become an eBay member, to shop for goods, or to purchase goods from eBay sellers. Sellers pay a minimal amount to list items for sale, and another small percentage of the value when an item is sold. There are no monthly fees or other hidden costs.

·                        Green. eBay is has proven to be a boon to the environment. Millions of tons of goods that would otherwise go into landfills or more resource-intensive recycling programs instead find new homes every year thanks to eBay. Some of these goods include consumer electronics items like computer parts and mobile phones that release toxic substances once they're discarded and exposed to the environment.

·                        Socially responsible. Because eBay eliminates middlemen and lowers barriers to buying and selling, potters in rural Mexico and bead weavers in central Asia can sell hand-made goods directly and inexpensively to a massive global audience. This brings new economic opportunities to developing areas and increases cultural understanding between populations. eBay has become one of the world's most interesting and exciting trans-national ambassadors.

·                        Like the real world in many ways. Just as you'll encounter both honest and dishonest people in the real world, you'll find both honest people and crooks on eBay. Thankfully, eBay's site includes a selection of tools like the feedback system that are designed to help you to remain safe as an eBay member.

In short, since eBay's founding in 1995 it has become the world's largest place to buy and sell, a community of hundreds of millions of regular people, small businesses, and even big businesses from all of the seven continents. Millions of items of every kind imaginable, in every condition imaginable, change hands every day on eBay for prices ranging from one cent to hundreds of thousands or even millions of dollars (or pounds, or other forms of currency).

What is mission statement & vision statement

What is a vision statement?

A Vision Statement is the motivation and framework of a corporation's strategic planning and unlike the mission statement it focuses on the company's future rather than the here and now. The purpose of a vision statement is to remind the owner, partners, employees, and investors what they are trying to achieve and it can be applied to either the entire corporation or even just a single division within. It compiles all of the company's hopes, dreams and future goals, concentrates on what exactly the organization wants to be and provides very clear decision-making criteria on how to reach that objective.

What is a mission statement?

A mission statement is a formal, short, written statement of the purpose of a company or organization. The mission statement should guide the actions of the organization, spell out its overall goal, provide a sense of direction, and guide decision-making. It provides "the framework or context within which the company's strategies are formulated." Historically it is associated with Christian religious groups; indeed, for many years, a missionary was assumed to be a person on a specifically religious mission. The word "mission" dates from 1598, originally of Jesuits sending ("missio", Latin for "act of sending") members abroad.

Sell side/ Supply side with eBay Networked Organisation Group project

 This is a sell side/ supply side map for eBay ( Case study 1.3  pp.42 Text book)

Corporation Background:

A California software engineer named Pierre Omidyar coded the site on 4^th Sep 1995. Therefore, it became eBay in 1997. The eBay market place is well known for the service which enables sellers to list items for sale on an auction or fixed-price basis giving buyers the opportunity to bid for and purchase items of interest. The marketplace platforms include an average of 100 million products for sale on each day.

Revenue Model:

1.      The eBay marketplaces approximately 70% of net revenues in the core business in 2007.

2.      PayPal approximately 25% of the net revenues in 2007.

3.      Skype Internet telephony contains 5% of the net revenues in 2007.

4.      Advertising and other net revenues totaled $94.3 million in 2004. ( just 3% of the net revenue)

eBay proposition:

  eBay use the successful strategic approach to take advantage of increased consumer adoption of the internet. But also they did good job on the integration across the customer and suppliers.

This is the force to point out the crucial elements make eBay success.

For buyers:

Selection   Value

Convenience   Entertainment

For Seller:

Access to broad markets      Cost-effective marketing and distribution

Access to large buyer base     Good conversion rates.

Compare to the order Management:

  We are experiencing the changes of CRM and SRM in the High-tech industry and manufacturing industries around the world. eBay did the work to make the business’s CRM and SRM systems answers from customer and supplier standpoints. On the costumer side, it is hard to control the customer orders managed cost effectively across the order fulfillment chain. In the mean time, to manage the interaction with the vendor taking into account the customers’ purchase decisions.

  In sum, to take an enterprise view of CRM and SRM systems is the key to success. Corporations must integrate these systems to achieve each part of the business are connected and collaborated.