case study of ebay

eTail Palm Springs 2025

February 24 - 27, 2025

JW Marriott Desert Springs, Palm Springs, CA

eBay Case Study: Marketing Strategy Innovation in Action

Initially beginning life as AuctionWeb back in the days of the dotcom bubble, eBay not only survived that tumultuous period in internet history but has continued to thrive and become the biggest customer to customer selling site in world.

According to the company’s latest financials , the first quarter of 2022 saw eBay generate revenue of $2.5 billion with a gross merchandise volume of $19.4 billion. eBay has performed better than expected in this period – perhaps due to an increased number of people selling items acquired during the pandemic when ecommerce shopping was at its zenith.

Most people don’t associate eBay with marketing campaigns and traditional marketing efforts, but this couldn’t be further from the truth. eBay has a solid and innovative marketing strategy which helps it hammer home its position as a service platform rather than a traditional ecommerce retailer.

With that in mind, let’s dive into this special eTail West case study to discover what’s under the hood of the eBay marketing machine – before we get outbid.

Historic Marketing

eBay has long had a reputation for out of the box marketing strategies and these go right back to its early days during the dotcom boom.

In 1997, when the company officially changed its name from AuctionWeb to eBay, there was a rumor that the site was conceived so that founder Pierre Omidyar’s fiancé could sell her collection of Pez candy dispensers. This human-interest element to the eBay story created enormous publicity for the nascent platform and helped it achieve explosive growth in the collectibles market – a sector it is still incredibly popular with today.

This in turn helped fuel the 1997 Beanie Baby craze and resulted in the hard-to-find toys accounting for 10% of all listings on eBay for the year.

However, the story was a complete fabrication, cooked up by then public relations manager, Mary Lou Song. The Pez dispenser myth could be the first example of this kind of storytelling in marketing and helps demonstrate how eBay was innovating in the digital marketing space from the word go – even if it weren’t the most authentic of strategies.

Legacy Media

While our focus is often drawn to modern digital channels when crafting our marketing strategies, eBay isn’t ready to turn its back on legacy media just yet. In fact, the online selling platform announced in 2021 its intention to pour marketing resources into that old living room stalwart – television.

With testing to begin in the UK, before global rollout is considered, eBay believes TV is still a powerful channel when it comes to brand building and will form a core thrust of its effort to communicate the idea that eBay is more than a second-hand seller.

"We don’t want to be defined by that online car boot sale reputation anymore,” said eBay in a press statement. "We need to get people to consider eBay in a completely different way. The UK is the petri dish for testing a new approach to rebuilding the brand globally. It is all about a shift away from the marketplace and over to being the ultimate shop. TV is still on fire and a wonderful medium to get neurons into people’s brands in order to rewire their perceptions. If you ask someone where they are shopping on Black Friday, then TV is the best place to put eBay at the front of their consideration set.”

Social Sharing

We all know how powerful social media can be when it comes to promoting products and eBay is no exception. This is why in 2021, the company announced it would be incentivizing sellers to promote their listing on their social media channels by offering a reduction in fees for those who do so.

"We all know that increasingly buyers are discovering products and getting validation of those products through their social channels. And so, first," said Vice President of eBay Stores, Tom Pinckney . "We're improving the basic capabilities of how you can go to the listing page and share your listing into these different channels.”

Sellers which promote their posts on social media will get a significant reduction in fees if a customer clicks through a social link, through to their seller page, and completes a purchase. If these conditions are met, the seller will only be charged 2.5% final value fees and a 30-cent transaction charge.

With free at point of use services such as Facebook Marketplace posing an existential threat to sites such as eBay, incentivizing sellers to promote both themselves and eBay as a platform on those very same social media platforms is a terrific way to try and drive traffic towards the site

The promotion has proved so successful that in April 2022, eBay announced it would be expanding the social sharing offer to other markets around the world, including a limited release in Australia. While the promotion may only be temporary to begin with, it seems likely eBay will extend the offer if it sees significant engagement during the promotional period in question.

Love Island

Love it or hate it, there’s no denying the television mega hot that is Love Island. The British reality/dating show has found a dedicated following across the world as millions tune in to watch the drama unfold among these attractive young people.

The final episode of the 2022 season pulled in a staggering 3.4 million viewers – up 100,000 on the previous year – with the consolidated series average currently stands at 4.6 million across devices once catch-up data and ITV Hub audiences are accounted for.

With influencer marketing being so popular right now, it was only natural that eBay would turn to one of the stars of the show to help drive its brand messaging to a wider demographic of highly engaged potential customers.

For this partnership, eBay selected on of the contestants from the 2022 season, Tasha Ghouri who it named its Pre-Loved Ambassador. This collaboration is the first to come out of the TV show which focusses on the joys of second-hand clothing and eschews the environmentally harmful fast-fashion space which is responsible for so much waste being dumped in landfills around the world.

"Prior to Love Island, I’ve always bought secondhand for my wardrobe, so partnering with eBay really is a dream come true,” wrote Ghouri in an Instagram post announcing the partnership with eBay. "I feel passionately that we can all make little swaps to our wardrobes and our lives for the better and so I’m excited to join eBay on their mission to put secondhand fashion at the front and center.”

The collaboration with Ghouri follows a partnership eBay established with Love Island during its 2022 season run where it provided the show’s contestants with collections of pre-loved clothing in an attempt to inspire viewers to engage in a circular clothing ecosystem. Convincing customers to embrace second-hand clothing is not only beneficial to a platform such as eBay, but also helps reduce our consumption levels and the environmental impact of the fashion industry.

In September 2022, Ghouri released her first collection on eBay – a special edit of 60 items of clothing which will be available for a limited time on the platform. All proceeds from the collection will go to Ghouri’s chosen charity – the Royal National Institute for Deaf People.

"I’ve always enjoyed being playful with clothes - mixing and matching existing pieces in my wardrobe with vintage designer finds - so partnering with eBay and being able to create my own pre-loved capsule is a dream come true,” said Ghouri at the announcement. "With this collection, I wanted to include the timeless staples I reach for most in my own wardrobe, from denim jackets to sparkly dresses and big blazers that can be dressed up or down. I’m passionate about showing how easy it is to make those little swaps so that we shop more sustainably, whilst still serving amazing looks!”

Final Thoughts

eBay survived the dotcom crash of the early 2000s and came back fighting to become one of the biggest and most widely recognized ecommerce brands on the market today. With a solid marketing strategy which has been ahead of its time from the very beginning of its life, eBay has proven on numerous occasions that it is here to stay and can still trade blows with the best in the business.

Innovative and exciting marketing strategies in the ecommerce space are sure to be part of the conversation at eTail West 2023 , being held in February and March at the JW Marriott Desert Springs, Palm Springs, CA.

Download the agenda today for more information and insights.

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Home » Information Systems Management » Case Study: eBay”s Business Model

Case Study: eBay”™s Business Model

Founded on 1995 by Pierre Omidyar , eBay was considered a pioneer in the online auction industry whereby people are brought together on a local, national and international basis to serve the purpose of creating a person-to-person community where ever individual could have an equal access through the same medium which is the Internet. eBay offers wide varieties of products and services for bargain hunters, hobbyists and collectors and sellers, changing the way people engage in trading hence eBay had changed the face of e-commerce from its inception. Today, eBay is continuously the brand preference with over 39 market presence and with $60 billion of the total value of sold items on the site’s trading platform.

Basically, eBay introduced several crucial innovations tailor-made for the internet at the business level, a strategy which was conceived to be an improvisation. The online auction business model is where eBay served as the value-added facilitator of trade between a buyer and a seller in a highly individualistic manner. The online auction model developed by eBay marked an important extension of e-commerce , offering millions of individuals a low-cost opportunity to engage in a new type of economic activity.

When Whitman arrived in 1998 as eBay’s second president and CEO, eBay became a public listed company in September of that year, brand building recognition at eBay was prioritized. eBay’s registered users had grown six-fold, to over 2 million. Under Whitman’s leadership the company grew to over 200 million users globally and over $7 billion in revenue. During her tenure, Whitman helped eBay enter China, integrated globally recognized brands like PayPal and Skype into eBay portfolio and successfully steered the company through the dot-com bust by staying focused on its core users and core competency-online auctions. eBay made acquisitions in order to support its growth as a supplement to word-of-mouth and public relations advertising into tapping opportunities through national magazines and online alliances. These acquisitions aid in the expansion and improvement of the company’s services.

eBay is currently the first ranked online auction company within its industry, with nearly one-third of U.S. internet users registered on its site.   The company is a substantial threat internationally as well, competing in the Asian, European, and Latin American markets.   The online auction industry commands significant revenues that continue to increase to the projected amount of $229.9 billion by 2008.   The outlook for both eBay and the online auction industry holds great promise, as is evidenced through the study of SWOT analysis , the driving forces of the industry, key success factors, eBay’s financial status, and eBay’s positioning in the market.   eBay must also keep in mind the key strategic issues facing the company.

eBay’s Business Model

eBay’s business model was based on creating and maintaining a person-to-person trading community. After implementing their business model , eBay has been able to build strategic partnerships, continue to make innovative changes and improvements, and monitor its internal and external environments for possible future opportunities.   This has given them the prestige of being the world’s largest online auction company.

Target Market:

Sellers and buyers who transact online

Largest Online Auction:

From its beginning in the mid-1990s, eBay has been growing in leaps and bounds.   They now have over 94.9 million registered users in more than 150 different countries.   eBay’s founder Pierre Omidyar did not even see the tremendous possibilities that eBay had when it was first developed over ten years ago.   eBay now holds the top spot in the online auction industry.   In the United States alone one-third of the population is already registered with the site and with increasing use of the internet that number is sure to grow.

Over 27,000 Different Categories:

The wide variety of products offered on eBay gives them a competitive advantage above all other online auction sites.   They are like the Wal-Mart of the Internet!   They say that anything you want you can find on eBay.

Partnerships with International Companies:

Partnerships abroad can be crucial to a company succeeding in foreign markets.   By partnering with established foreign companies, like Alando in Germany, iBazar in France, Tradera in Sweden, Internet Auction in South Korea and Bazee in India, eBay is able to easily transition into that countries culture with the help of citizens who work with the partnering company.  eBay also immediately acquires ties with companies in the foreign market, which makes it simple for them to make more partnerships and alliances. In 2007, eBay established a partnership with a Beijing-based Internet company, Tom Online Inc., taking 49 percent stake in the company and possessing administration rights. This allows ebay to have strong local management that understands the culture and consumer desires. Tom eBay has done much to win the trust of Chinese consumers such as using escrow service to hold payments until buyer confirms satisfactions with the product.

Over 250 Alliances:

eBay aligned with Yahoo! In 2006 in a marketing alliance to promote revenue growth for both companies. Under this alliance, Yahoo! Became the exclusive advertising provider on eBay and PayPal became Yahoo!’s preferred provider. Google also aligned with eBay in 2006, making Google the primary advertiser on eBay’s websites outside of the United States. Google sought to integrate Skype into the alliance as a method to further sales from Web advertising. eBay also holds alliances with some of the largest companies in the world.   They include Northwest and Southwest Airlines to enable PayPal as a method of payment option, and with Wal-Mart and My-Space.com to promote growth of Skype, and Buy.com in 2008, a middle-of-the market tool that links retailers with buyers and immediately added five million fixed-priced listings to the eBay marketplace.   These alliances create more opportunities for eBay to advertise and reach potential customers.

Acquisition:

To increase its geographic reach and to move into related businesses such as online payments, to obtain technology that will strengthen its product differentiation, eBay has completed many acquisitions such as Half.com in 2000 to enter the fixed price market price for products like used books, CD’s, games and DVD’s; Paypal to enable sellers to receive online payments from buyers’ credit cards or checking account; Shopping.com that allows people to search for products and compare prices, and Rent.com that joins landlords and tenants online, charging property owners for each lease produced. eBay then acquired 28 percent of Craiglist in 2004 and Skype in 2005, an internet phone provider to allow buyers and sellers to communicate prior to transactions. Other acquisitions would include Stubhub.com in 2007, a secondary ticket place marketplace that integrates guaranteed fulfillment and shipment using FedEx . And Fraud Science Ltd in 2008 to detect fraudulent purchases and provide eBay with the technology that it needs, to improve the level of trust that it provides.

Positioning of eBay

eBay positions itself in the online auction industry using a broad differentiation strategy .   By choosing this strategy eBay determined that the best way to achieve a sustainable competitive advantage over its rivals was to differentiate their service.   The way in which eBay has set their online auction site apart from its competitors has lead customers to prefer their site over other online auctioneers and retailers

eBay’s Broad Differentiation Strategy

eBay has created a one-stop-shopping experience that is appealing to large corporations, independent entrepreneurs, and individual buyers and sellers.   They have created value through many facets of their business that appeal to their customers and differentiate them from the competition.   The main ways that eBay differentiates themselves is through:

• Variety of products offered
• When customers visit eBay they can search for virtually any product.   eBay boasts a category variety not matched by any competitor with over 27,000.
• The eBay Community
• eBay wants their customers to feel like they are a part of a community.   This community feel gives customers the sense that they are branch of something and cared about.   By showing the customers that their feedback, opinions, and feelings are important eBay has gained tremendous ground with their customers.
• The eBay Website
• eBay has created an auction and retail website that is unique and interesting.   This creative site sets them apart from their competitors.   The site is set up with many facets that reach a broad span of visiting buyers and sellers.   The site is also entertaining and easy to use making it very appealing for online shopping and trading.
• The eBay Brand Name
• eBay was the creator of the online auction industry.   When customers think of online buying the immediately think of eBay.   This has given them a competitive advantage that sets them apart from other online auctions.
• eBay’s Global Reach
• The global reach of eBay is not achieved by any other online auction site.   For large corporations international selling and buying is done everyday.   Even for an individual buyer or seller, having the option of searching throughout 150 countries with a span of 94.9 million users is very appealing.

Why the Differentiation Strategy Works Best for eBay

The users of eBay have many different preferences and needs depending on why and how they use the service.   eBay has determined a way to satisfy their customers whether they are large businesses or individuals.   By offering a wide variety of products, globally expanding, and creating a community for all customers to join eBay has created a distinctive value unmatched by its rivals.

Analysis of eBay’s Business Model

eBay’s business model was based on creating and maintaining a person-to-person trading community.   This allows buyers to easily search for what they want to purchase.   It also allows sellers to post their items minutes after they have registered.   There are a few specific elements of eBay’s business model that they recognized as key to its success they are:

• Being the largest online trading forum with a critical mass of buyers, sellers, and items listed for sale
• Its compelling and entertaining environment, which had strong values, established rules and procedures that facilitated communication between buyers and sellers
• Establishing programs such as Safeharbor to aid in disputes and to punish users who violate eBay
• Cost effective and convenient trading
• Strong community affinity
• An intuitive user interface that was easy to understand, arranged by topics, and fully automated

By implementing their business model, eBay employed three main tactics.   First, they looked to build strategic partnerships.   Second, they looked for customer feedback to constantly make changes and improvements.   Finally, they monitored its internal and external environments for possible opportunities.   By doing all of these things, eBay was able to adapt to the changing ways and keep their customers satisfied.

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Case Study: Ebay

eBay  is The World’s Online Marketplace™. Founded in 1995, eBay created a powerful platform for the sale of goods and services by a passionate community of individuals and businesses.

On any given day, there are millions of items across thousands of categories for sale on eBay, as well as on Half.com, eBay’s site dedicated to fixed price trading.

eBay enables trade on a local, national and international basis with customized sites in markets around the world. [Source: eBay]

Things to read:

• About eBay ;
• Company Overview ;
• eBay Trust and Safety ;
• eBay Security and Resolution Center ;
• eBay Community Values ;
• eBay  Safe Harbor ;
• Annual Reports .

Questions to consider:

• eBay is one of the only major Internet “pure plays” to consistently make a profit from its inception. What is eBay’s business model? Why has it been so successful?
• Other major web sites, like Amazon.com and Yahoo!, have entered the auction marketplace with far less success than eBay. How has eBay been able to maintain its dominant position?
• What method does eBay use to reduce the potential for fraud among traders on its site? What kinds of fraud, if any, are eBay users most susceptible?
• eBay makes every effort to conceptualize its users as a community (as opposed to, say “customers” or “clients”). What is the purpose of this conceptual twist and does eBay gain something by doing it?
• eBay has long been a marketplace for used goods and collectibles. Today, it is increasingly a place where major businesses come to auction their wares. Why would a brand name vendor set-up shop on eBay?

Intellectual Property

Selected trademark applications and registrations:

• THE WORLD’S ONLINE MARKETPLACE;
• SAFEHARBOR ®;
• Search real-time for  U.S. trademarks .

Selected patents:

• 6,415,320  — Information presentation and management in an online trading environment;
• 6,058,417  — Information presentation and management in an online trading environment;
• Search real-time for new U.S. patents granted to  eBay .

• Free Website Audit

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• + 919123959931

eBay marketing strategy case study 2021

A case study focusing on ebay marketing strategy.

2021 eBay marketing strategy update: E-commerce giant records highest quarterly revenue Q1 2021

Ebay has had a fascinating year. The quarterly revenue chart below depicts both highs and lows for this company in the last 12 months. Plunging to a low revenue of US $2,129 million in quarter 1 of 2020, the company then rocketed to it’s highest recorded quarterly revenue of US $3,023 in quarter 1 of 2021. That’s YOY growth of US $894 .

Moreover, ending the year on a high, Ebay finished 2020 with it’s highest annual net revenue so far, at US $10,271 million . This demonstrates that e-commerce is still a growing sector, despite the initial market uncertainty during the onset of the pandemic. Lessons learnt from studying Ebay marketing strategy – react to market challenges to create new opportunities, to stay ahead in a competitive environment.

EBay ended 2020 with 185 million active buyers, up 11 million from the end of 2019. EBay acquired 3 million new shoppers in the second half of the year, even as panic-buying essentials slowed down and stores opened back up, leading experts to believe eBay’s turnaround may last post-pandemic:

“EBay is proving that it has the ability to sustain the gains it is seeing from COVID,” says Ygal Arounian, an analyst at Wedbush Securities. “We expect these trends to increasingly become ingrained in consumer behavior, which will support eBay in 2021.”

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2018 stat update: Over 50% of purchases on eBay in the UK from mobile

At the end of 2017 eBay had 168 million 12-month active buyers, an increase from 90 million active in 2010. Nearly two-thirds of transactions are now international. The challenge of growing the business can be seen by the near static GMV in the last three years. Globally 58% of GMV is now transacted on smartphone.

Updating eBay brand positioning using traditional media

In an interview with eBay UK marketing director Gareth Jones, explained that:

“We don’t want to be defined by that online car boot sale reputation anymore. We need to get people to consider eBay in a completely different way. The UK is the petri dish for testing a new approach to rebuilding the brand globally. It is all about a shift away from the marketplace and over to being the ultimate shop”. 

He is candid that a past focus on prioritising digital channels has had a “small impact” on changing eBay’s perception. Despite stating we’re in an age of digital-based marketing, he believes TV is the best channel for brand building. This is based on regional tests that proved TV is the best place to get people to reap-praise eBay as a brand:

“TV is still on fire and a wonderful medium to get neurons into people’s brands in order to rewire their perceptions. If you ask someone where they are shopping on Black Friday then TV is the best place to put eBay at the front of their consideration set.”

It’s hard to believe that one of the most celebrated dot-coms has now been established nearly 20 years. Pierre Omidyar, a 28-year-old French-born Software Engineer living in California coded the site while working for another company, eventually launching the site for business on Monday, 4 September 1995 with the more direct name ‘Auction Web’.

Legend reports that the site attracted no visitors in its first 24 hours. The site became eBay in 1997 and by 2012, it had 112 million active users globally defined as users who have bid, bought or listed an item during the preceding 12 month period, with the total worth of goods sold on eBay $60 billion, which is equivalent to $2,000 every second. Total revenue was $8.7 billion.

eBay’s Mission

eBay describes its purpose as to ‘pioneer new communities around the world built on commerce, sustained by trust, and inspired by opportunity’.

eBay’s 2016 report describes the company’s view on current marketing approaches of exploiting Big Data and Artificial Intelligence.

To deliver the most relevant shopping experience, we continue our efforts to better understand, organize and leverage eBay’s inventory. With our structured data initiative, we are able to begin organizing our vast inventory around products rather than listings and aggregate insights into supply and demand. We continue to broaden the coverage of structured data, which enables us to create and start rolling out new consumer experiences that are modern, simple and differentiated. One of our goals is to deliver a more personalized shopping experience by determining what products to show our consumers and highlight the incredible price and selection advantages that eBay often provides across categories.

eBay’s Revenue model

The vast majority of eBay’s revenue is for the listing and commission on completed sales. While it is best-known for auctions,  80% of UK sales now coming through new items  of which the majority are fixed price. UK marketing director Gareth Jones told Marketing Week he wants to focus on top-of-the-funnel consideration: “ it wants British consumers to see it as the first choice for buying new items as opposed to its historic online car boot sale reputation “.

For PayPal purchases an additional commission fee is charged.

Margin on each transaction is phenomenal since once the infrastructure is built, incremental costs on each transaction are tiny – all eBay is doing is transmitting bits and bytes between buyers and sellers.

Ebay marketing strategy proposition

The eBay marketplace is well known for its core 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. Software tools are provided, particularly for frequent traders, including Seller’s Assistant, Selling Manager and Selling Manager Pro, which help automate the selling process, plus the Shipping Calculator, Reporting tools, etc.

Today over 60% of listings are facilitated by software, showing the value of automating posting for frequent trading.

An example of a new Shopper feature which is part of its OVP is the eBay ShopBot on Facebook Messenger.

This uses artificial intelligence to provide a personalized shopping assistant that helps people find the best deals from eBay’s one billion listings.

According to the SEC filing, eBay summarises the core messages to define its proposition as follows:

For buyers:

• Convenience.

In 2007, eBay introduced Neighbourhoods where groups can discuss brands and products they have a high involvement with.

For sellers:

• Access to broad global markets
• Efficient marketing and distribution
• Opportunity to increase sales.

In January 2008, eBay announced significant changes to its marketplaces business in three major areas: fee structure, seller incentives and standards, and feedback. These changes have been controversial with some sellers, but are aimed at improving the quality of experience.

Detailed Seller Ratings (DSRs) enable sellers to be reviewed in four areas: (1) item as described, (2) communication, (3) delivery time and (4) postage and packaging charges. This is part of a move to help increase conversion rate by increasing positive shopping experiences.

For example, by including more accurate descriptions with better pictures and avoiding excessive shipping charges. Power sellers with positive DSRs will be featured more favourably in the search results pages and will gain additional discounts.

Risk factors

Fraud is a significant risk factor for eBay. BBC (2005) reported that around 1 in 10,000 transactions within the UK were fraudulent; 0.0001% is a small percentage, but scaling this up across the number of transactions, this is a significant volume.

To counter this, eBay has developed ‘Trust and Safety Programs’ which are particularly important to reassure customers since online services are prone to fraud.

For example, the eBay feedback forum can help establish credentials of sellers and buyers. Every registered user has a feedback profile that may contain compliments, criticisms and/or other comments by users who have conducted business with that user. The Feedback Forum requires feedback to be related to specific transactions and Top Seller status was introduced in 2010 to increase trust in the service.

There is also a Safe Harbor data protection method and a standard purchase protection system.

The fees model that eBay uses is often changed and this can cause problems with users, but the impact is calculated that it does not affect overall sales. In their 2012 SEC filing eBay note: ‘We regularly announce changes to our Marketplaces business intended to drive more sales and improve seller efficiency and buyer experiences and trust. Some of the changes that we have announced to date have been controversial with, and led to dissatisfaction among, our sellers, and additional changes that we announce in the future may also be negatively received by some of our sellers. This may not only impact the supply of items listed on our websites, but because many sellers also buy from our sites, it may adversely impact demand as well’.

In common with other global platforms like Amazon, Facebook and Google, eBay note the potential threat of the shift to tablet and smartphone platforms noting that one risk factor is: ‘Our ability to manage the rapid shift from online commerce and payments to mobile and multi-channel commerce and payments’.

There is also the common risk factors for online pureplays of retaining an active user base, attracting new users, and encouraging existing users to list items for sale, especially when consumer spending is weak.

Competition

Although there are now few direct competitors of online auction services in many countries, there are many indirect competitors. SEC (2012) describes competing channels as including online and offline retailers, distributors, liquidators, import and export companies, auctioneers, catalogue and mail order companies, classifieds, directories, search engines, products of search engines, virtually all online and offline commerce participants and online and offline shopping channels and networks. In their SEC filing, eBay states that the principal competitive factors for the Marketplaces business include the following:

• ability to attract, retain and engage buyers and sellers;
• volume of transactions and price and selection of goods;
• trust in the seller and the transaction;
• customer service; and brand recognition.

Amazon is one of the biggest competitors since it also has marketplace sellers integrated into its products listings. It’s latest SEC filing notes: Consumers and merchants who might use our sites to sell goods also have many alternatives, including general e-commerce sites, such as Amazon and Alibaba, and more specialized sites, such as Etsy.

Competitive factors today are listed as:

• customer service;
• brand recognition;
• community cohesion, interaction and size;
• website, mobile platform and application ease-of-use and accessibility;
• system reliability and security;
• reliability of delivery and payment, including customer preference for fast delivery and free shipping and returns;
• level of service fees; and
• quality of search tools.

Before the advent of online auctions, competitors in the collectables space included antique shops, car boot sales and charity shops. Anecdotal evidence suggests that all of these are now suffering. Some have taken the attitude of ‘if you can’t beat ’em, join ’em’. Many smaller traders who have previously run antique or car boot sales are now eBayers. Even charities such as Oxfam now have an eBay service where they sell high-value items contributed by donors. Other retailers such as Vodafone have used eBay as a means to distribute certain products within their range.

Objectives and strategy of eBay

The overall eBay aims are to increase the gross merchandise volume and net revenues from the eBay marketplace. More detailed objectives are defined to achieve these aims, with strategies focusing on:

• Acquisition – increasing the number of newly registered users on the eBay marketplace.
• Activation – increasing the number of registered users that become active bidders, buyers or sellers on the eBay marketplace.
• Activity  – increasing the volume and value of transactions that are conducted by each active user on the eBay marketplace.

The focus on each of these three areas will vary according to strategic priorities in particular local markets. eBay marketplace growth was driven by defining approaches to improve performance in these areas.

• First, category growth was achieved by increasing the number and size of categories within the marketplace, for example Antiques, Art, Books, and Business and Industrial.
• Second, formats for interaction. eBay Stores was developed to enable sellers with a wider range of products to showcase their products in a more traditional retail format including the traditional ‘Buy-It-Now’ fixed-price format.

eBay has constantly explored new formats, often through acquisition of other companies, for example through the acquisition in 2004 of mobile.de in Germany and Marktplaats.nl in the Netherlands, as well as investment in craigslist , the US-based classified ad format. Another acquisition is Rent.com , which enables expansion into the online housing and apartment rental category. In 2007, eBay acquired StubHub, an online ticket marketplace, and it also owns comparison marketplace Shopping.com .

Finally, marketplace growth is achieved through delivering specific sites localized for different geographies as follows.

You can see there is still potential for greater localization, for example in parts of Scandinavia, Eastern Europe and Asia. Localized eBay marketplaces:

• South Korea
• Switzerland
• Netherlands
• New Zealand
• Philippines
• United Kingdom
• United States

In addition, eBay has a presence in Latin America through its investment in MercadoLibre.

eBay marketing strategy for growth

In its SEC filing, success factors eBay believes are important to enable it to compete in its market include:

• ability to attract buyers and sellers;
• customer service; and brand recognition.

This implies that eBay believes it has optimized these factors, but its competitors still have opportunities for improving performance in these areas which will make the market more competitive. According to its 2010 SEC filing: Our growth strategy is focused on reinvesting in our customers by improving the buyer experience and seller economics by enhancing our products and services, improving trust and safety and customer support, extending our product offerings into new formats, categories and geographies, and implementing innovative pricing and buyer retention strategies.

Updates on eBay marketing strategy information

Found our eBay marketing strategy blog useful? Keep up to date with the latest trends and innovations with expert advice and real-life case studies so you can win more e-commerce customers. Get started today.

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eBay Motors uses Firebase ML to quickly categorize images, reduce costs and improve user experience

Introduction

eBay Motors allows users to search and find cars for sale in their area. Users can also upload pictures of cars that they want to sell, using a simple and easy-to-use inteace through the mobile app. The app is targeted towards auto enthusiasts: customers who care about cars. These are folks that see a car as something much more than a utility that helps them get from point A to B.

This type of buyer expects a more detailed description of the car and insights into its history. For sellers, it's of the utmost importance to have well-taken pictures uploaded for their car listings in the app. However, tagging each photo as an exterior, interior or engine requires a lot of manual effort, which can delay posting a car for sale, and ultimately prevent more people from listing their cars through the app.

The eBay Motors app development team spent a lot of cycles trying to figure out how best to automate the tagging of these photos, but still didn't have a solution they were happy with.

The team realized that they did not need to build all of this functionality in-house and turned to AutoML Vision Edge to help them with this user experience challenge. "There were two key considerations: how do we provide a seamless upload experience for sellers to reduce friction for them when creating listings, and how do we reduce the amount of cost, both in terms of engineering effort and server costs, to support this type of feature," said Jake Hall, Head of Native Apps for eBay Motors. AutoML addressed both issues head on, "allowing us to improve the time it takes to create a listing through the app, which obviously has clear implications for us in terms of seller ROI," added Hall.

Thanks to AutoML Vision Edge, the eBay Motors team was able to go from concept to prototype within a week using their own data set. With just a few hours of data labeling, they were also able to improve the model to a level that they feel comfoable using in production.

1 week to go from concept to prototype (using their own data set)

20 hours of data labeling needed to use the model in production

"AutoML allowed us to improve the time it takes to create a listing through the app, which obviously has clear implications for us in terms of seller ROI."

- Jake Hall, Head of Native Apps, eBay Motors

Integrating it into your app is easy.

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Ebay case study, neo4j powers intelligent commerce for ebay app on google assistant.

The Challenge

eBay is continually looking to improve the ways shoppers search for the items they seek. SVP & Chief Product Officer RJ Pittman explains how existing product searches and recommendation engines are currently unable to provide or infer contextual information within a shopping request. As an example, Pittman considers the information implied within the phrase: “My wife and I are going camping in Lake Tahoe next week, we need a tent.”

He observes that most search engines would react to the word “tent.” But the additional context regarding location, temperature, tent size, scenery, etc. is typically lost. Yet, this type of specific information is actually what informs many buying decisions. Relaying or maintaining this context is often a burden left to the user and a new solution was needed to remove the hard work associated with shopping.

The Solution

To build the eBay App for Google Assistant, the knowledge graph they needed would be coupled with natural language understanding and artificial intelligence to store, remember and learn from past interactions with shoppers.

eBay chose Neo4j as the native graph database that holds the probabilistic models that aid understanding in the conversational shopping scenario. The Neo4j graph contains both the product catalog and the attributes of shopper interactions while seeking products.

When a shopper searches for “brown bags” for example, the eBay App knows what details to ask about next, such as type, style, brand, budget or size. As it accumulates this information by traversing through the graph, the application is continuously checking inventory for the best match. This is a great example of real-time decision making.

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EBay Company’s Marketing Managment Case Study

Reasons why ebay have succeeded as an online auction market place, evaluating the ebay fee structure, the future of ebay, works cited.

Kotler and Keller assert that the success of eBay was as result of their capability to create new pricing strategies that enabled the bidders or buyers to establish the values of the products they need 411. The ability of the consumers to predetermine the prices created a feeling of control among the consumers. Consumers also had the capability of bargaining the best prices. Moreover, the website enabled the consumers to reach a wide variety of sellers as well as the products to choose (Kotler and Keller 411).

On the other hand, the eBay platform enabled sellers to meet a variety of customers at reduced costs. In fact, eBay established a distinctive online business that attracted both the customers and the auctioning firms. The uniqueness of eBay attracted customers from the competitors resulting in most of the competing firms merging or shutting down (Stevens 141).

The online firm has been successful on the online business because of the knowledge of the needs of the customers. Moreover, eBay had a proper knowledge of its customers and targeted their needs that the competitors did not give much attention (Kotler and Keller 411). In fact, the firm was fast to identify the requirement of the people, do business in second-hand quality goods, and earn cost-effective proceeds.

The company became conscious of the fact that there is need for a platform where auctioneers for second-hand products could meet the buyers (Kotler and Keller 411). The company applied its technological competence to create the required platform that enabled free trade between the auctioneers and the buyers.

The firm has been able to build its credibility among the customers. The credibility the firm established during the first years of operation enabled many potential customers build trust on the firm (Stevens 141). Creditability is critical in the cyberspace where sellers meet potential customers virtually and exchange takes place.

The company builds this credibility through having high quality website that increases the capability of customers and sellers to interact (Stevens 141). Moreover, the company also embraced a well-established payment system including the WorldPay as well as PayPal that increased the customers’ confidence on the business. In fact, the reputable money transfer firms turned many non-believing customers to the business (Stevens 141).

Essentially, the success of the online auction was attributed to the simplicity of the user interactivity, the ability to offer wide variety of products, increased degree of trust among the customers, enhanced level of development and adaptability, augmented connection capabilities, improved levels of commitment and the ability to adopt the reputable and reliable payment options (Stevens 141).

The ability of the company to attract large volume of traffic also boosted the customers’ confidence and enabled increased frequency in buying. Moreover, the company developed an easily to use website that enabled increased interactivity. In addition, the company’s website has advanced features that allow easy navigation, increased availability, high-usage interaction and clutter-free (Kotler and Keller 411). All these features contributed to the success of the company.

The company has also been able to acquire similar firms that would have offered competition hampering its growth and development. Through these acquisitions, the company has grown from a simple online firm to a large international online firm operating in many countries.

The company attains its financial gains through fees it charges on the auctions. According to the company pricing policy, there is a fee charged for each listing while there is a final value charged on the fixed price. In fact, the seller meets all the charges. Taking an example in the case, there is a percentage charged on the $25 of each action. The percentage reduces depending on the amount sold.

A particular percentage is also charged on the remaining amount. For instance, the company will earn $5.69 in an auction that costs $100 dollars to the buyer. In other words, the seller will be charged 8.75% on the first $25 and 3.5% on the remaining $75. Numerically, (2.19 + 3.5) this equals to $5.69.

The fee structure could be improved by lowering the percentage on the fixed charge and increasing the percentage on the remaining amount. In other words, the pricing structure should be flexible to enable the company remain competitive.

Flexibility in the pricing structure should be made in such a way that it still deter the low-priced items auctioneers while at the same time increases the company competitiveness. The online business is currently becoming more competitive. Therefore, online businesses must ensure flexibility in all their operations to gain the competitive advantage. The pricing structure of eBay should not only be flexible but also enhance efficiency.

The successes that the company has achieved will enable its growth and expansion as well as remain competitive in the market. There are high possibilities that many competing online firms will emerge. However, the company will use its capabilities in terms of technology, finance and market share to remain at the top (Kotler and Keller 411). Moreover, the company is still capable of acquiring the competing firms that will add value to its customers. The future of the company also lies on the way it addresses the challenges it is facing.

The way the company addresses the challenges coming from the sectors such as the real estate markets as well as expensive collectibles will determine its future growth and development (Kotler and Keller 411). In addition, the company is facing challenges arising from regulations, honesty in the part of sellers as well as in the internet security. Besides, tackling these challenges, the company has to offer quality services to the sellers and the buyers. The quality services will enhance the confidence of the users of its site.

Forming partnerships with other online businesses such as Wiki together with social networking sites including Facebook and twitter is another opportunity the company can exploit for its future growth and development (Kotler and Keller 411). Partnership with these online companies will ensure increased market share and be found within the market niche of these online firms.

Moreover, the social sites will ensure continuous popularization of the company. The company must also come with innovative and unique ways of doing business in order to remain relevant in the market.

In addition, the company should make considerable investments to expand in new markets found in various developing and developed countries that lack the eBay presence. Further, the fixed-price options should also be a focus of the company. The fixed price options should provide superior prospects and enable the firm to advance into new markets (Kotler and Keller 411).

Kotler, Philip and K. Keller. Marketing Management. Upper Saddle River, NJ: Pearson Education, 2012. Print.

Stevens, Robert. Marketing Management: Text and Cases. London, UK: Routledge, 2012. Print.

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IvyPanda. (2024, February 26). EBay Company's Marketing Managment. https://ivypanda.com/essays/ebay-2/

"EBay Company's Marketing Managment." IvyPanda , 26 Feb. 2024, ivypanda.com/essays/ebay-2/.

IvyPanda . (2024) 'EBay Company's Marketing Managment'. 26 February.

IvyPanda . 2024. "EBay Company's Marketing Managment." February 26, 2024. https://ivypanda.com/essays/ebay-2/.

1. IvyPanda . "EBay Company's Marketing Managment." February 26, 2024. https://ivypanda.com/essays/ebay-2/.

Bibliography

IvyPanda . "EBay Company's Marketing Managment." February 26, 2024. https://ivypanda.com/essays/ebay-2/.

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eBay’s Journey to Passwordless with FIDO

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A global commerce leader connecting millions of buyers and sellers around the world, eBay Inc. enables economic opportunity for individuals, entrepreneurs, businesses and organizations of all sizes. Because its users are at the core of its success, eBay emphasizes providing a positive and secure experience for both buyers and sellers. 

As with most websites, every user’s interaction with eBay begins with logging onto the site and authenticating himself, i.e., verifying that they are who they say they are. However, the typical authentication sequence using usernames and passwords impacted the user experience – and made eBay more vulnerable to bad actors at the same time. Users were constantly forgetting and resetting their passwords – a frustrating process. And with many buyers and sellers using the same password for multiple accounts on multiple sites, a breach on any of those sites could open eBay to a breach as well. eBay knew it needed to make the authentication process more secure, but not at the expense of the user experience.

INSIDE FIDO STANDARDS

The FIDO protocols, including FIDO UAF and FIDO2 specifications, use standard public key cryptography techniques instead of shared secrets to provide stronger authentication and protection from phishing and channel attacks. The protocols are also designed from the ground up to protect user privacy. The protocols do not provide information that can be used by different online services to collaborate and track a user across the services, and biometrics, when used, never leave the user’s device. This is all balanced with a user-friendly and secure user experience through a simple action at login, such as swiping a finger, entering a PIN, speaking into a microphone, inserting a second-factor device or pressing a button.

Prioritizing Security and the User Journey

To add an extra layer of security to the login process, eBay implemented SMS one-time passcodes (OTPs). Even though it helped provide a more secure option, the method added costs, user friction and was still vulnerable to certain security issues. 

After reviewing a variety of other options to provide a simple, easy, and secure user authentication experience, eBay decided to roll out FIDO for strong authentication across both its native mobile app and browser-based mobile and web sites.

eBay decided to build its own open source FIDO server, which they felt gave them maximum control of the user experience and the end-to-end login flow. This approach also gives eBay better ability to manage its other login options, such as social logins. 

Realizing the Benefits of Standards

The strength of the FIDO Alliance and the FIDO standard, including the involvement of a wide range of major technology companies, was another significant factor in eBay’s selection of FIDO. 

“Choosing the FIDO standard for eBay user authentication was about more than simply adopting a secure protocol,” said Ashish Jain, head of Identity at eBay. “eBay operates in 190 markets and has a diverse set of users. We needed to make sure that any technology we choose can work consistently across various browsers and platforms.”

eBay’s Journey with FIDO: From Push to Passwordless

As a first step, eBay implemented FIDO for second factor authentication using the FIDO UAF protocol with a push notification flow. This meant that, when a user logged into eBay with a username and password, they would receive a notification from the mobile eBay app to confirm the login. Implemented as an opt-in feature, FIDO immediately garnered significantly higher opt-in rates than the previous SMS OTP solution, validating the FIDO standard’s ease of use.

Six months later, after seeing the already quick user adoption rate continue to rise, eBay decided to take the next step in passwordless authentication. In order to further simplify login flows, the company launched FIDO2 for primary authentication, no longer requiring users to take a second step to log in. Here’s how it works:

• When the user logs in as normal, eBay detects whether the device supports FIDO2. If so, the user receives a pop-up box asking them if they would like to enroll in passwordless authentication;
• If they opt in, the user is asked to enroll their facial or fingerprint biometric and is automatically enrolled;
• The next time the user logs in, all they need to do is present their biometric. No username and no password required.

Realizing Benefits for Both eBay and Its Users

Less than one year into its implementation of FIDO, eBay is already realizing its benefits: Not only are opt-in rates higher than for SMS OTPs, but also login success and completion rates have significantly improved, especially on mobile devices. eBay started to roll out FIDO2/WebAuthn on Android/Chrome and have since expanded to Mac, Windows as well as iOS. Recently, eBay has also added support for roaming authenticators, such as security keys providing another secure way to access eBay.

Looking Forward to a Completely Passwordless Future

In order to implement completely passwordless authentication, eBay must have a process in place for recovering accounts if a FIDO authenticator is lost or when  a user adds a new device. In typical password authentication, users can recover their accounts through the email/password reset process, but removing a password from the equation presents a new challenge. 

According to Jain, solving this issue is a priority for his team in the next six months.

“Today, our users can experience much faster and convenient login experiences by opting in to FIDO,” observed Jain. “But to fully realize the security benefits of FIDO, we’re looking forward to disabling passwords entirely. By taking one step at a time and working as an industry to find solutions to issues like account recovery, we believe we will get there.”

View the eBay Case Study PDF document here .

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Taobao vs. Ebay China

By 2008, Jack Ma, CEO of Alibaba.com Inc., was in a position to consider how to fortify Taobao’s dominant position in China’s online consumer-to-consumer (C2C) market. Ma and his company had come a long way since May 2003, when they first launched the Taobao website. Back then, eBay China dominated the fledgling market, holding over 70 percent share. It had entered China with its acquisition of the start-up EachNet, and was actively building upon that company’s first-mover advantage. By 2006, Taobao overtook eBay China, forcing eBay China to virtually exit the Chinese market. Although eBay would nominally continue to operate in China, it was no longer a concern in Ma’s plans for Taobao, which by 2008 held over 80 percent of the market. How had this upstart company overwhelmed the world’s most formidable player in the online C2C space and how would Ma meet the constant pressure to generate revenue?

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