EBay Technology Management - Case Study Example

EBay Technology Management Name: Course: Tutor: Institution: Date: Introduction The eBay Company offers electronic based services in the market. In this case, the organization operates in a highly dynamic environment, where changes in the technology market create market competition and high risks respectively. In this case, the radical changes in technology not only risk market competition, but also create the opportunity for the development and adoption of new technologies and new business models (Huang, Kinshuk and Chen, 2013, p.43). In this context, the essay offers a strategic analysis through which a new product could be developed in the market as a means of countering the market challenges, and capitalizing and maximizing on the overall market gains on technology development. Thus, the essay offers a specific analysis on how the eBay Company can apply and incorporate a new market idea to its operations. EBay Company Analysis In order to develop a strategic market business idea recommendation, it is imperative to develop and apply a market analysis on the organization. This is achieved through the use of SWOT analysis. A SWOT analysis is a strategic market tool that allows for the investigation of an organization strengths and opportunities, as well as potential market threats and weaknesses (Pahl and Richter, 2009, p.29). It is upon the application of the different strengths and opportunities that organisations develop new business ideas and models to overcome their weaknesses and potential market threats in the long run period. Strengths The organization has a key strength in the adopted business model. In this case, the model allows for a large market base and thus, has minimal market competition. In this case, the organization enjoys large market revenues of $ 14.07 Billion in 2012 (“Market Watch”, 2014). This strength is characterized and added to the existing market brand reputation in the market. As such, the high brand reputation, and the applied business model serves as its main strengths in the market. Weaknesses Nevertheless, the organization has a major challenge in the high fees charged on the platform. In this case, the venture charges both the sellers and the buyers a market fee for transactions made. Consequently, this has increased the cost of products on the platform. As a result, this has reduced its attraction to the large consumer base, which is increasing seeking out for relatively lower market costs, and as a result increasing the overall market expansion and growth challenges (Heap, 2013). Opportunities The key market opportunity for the venture is the increasing internet use and spread across the globe. In this case, the extent of internet coverage is expanding and increasing from the traditional developed nations, to the emerging and developing nations globally. As a result, this creates an opportunity for the increased spread and expansion of the venture into the global market respectively (Statistica, 2015). Threats Besides its market strengths on economies of scale, the organization faces a number of market threats. One of the challenges is the concept of online security. In this case, the rising threats of online accounts hacking in the global markets have created a safety threat. As such, the customer’s credit account details are often exposed to the risk of exposure and hacking in the market, risking their personal information as well as financial resources. In addition, there is a tendency for the rise of regional online retailers. In this case, other organisations such as Taobao among others pose a major challenge (Greeven and Yang, 2012). Business Idea and Model Based on the above analysis, it is apparent that the EBay Inc Company is facing a huge market potential as well as market threats. As such, it is imperative that the organization develops a critical market idea to explore on the existing market opportunities, while overcoming the weakness and threats in the market. In this case, the analysis recommends the adoption of regional retail centres (Ma, 2009, p.83). Currently, the organization has a single centralized EBay Inc Website. As such, all the global customers are expected to shop and source their products from this large online platform. However, this reduces its ability to respond to the emerging market needs in the emerging markets, which have unique sellers and buyers respectively. As such, the use of regional online shopping platforms will allow the organization respond to the rising market needs. As such, this will enable it capitalize on the emerging markets internet spread, by availing them a convenient shopping platform. Moreover, the regional platforms will allow the organization overcomes the rising risk of market and control loss in the regions by the regional online retail centres (“Business Insider”, 2014). Finally, the adoption of the proposed idea, will allow for the use of different languages. Currently, the platform relies on the use of the English language as the standard transaction language on the platform. However, through the development of regional online platforms, it will allow for the diversification of language use For instance, it will incorporate globally international languages such as Chinese, German, and French among others. Business Plan One of the features of the eBay platform is the use of PayPal as the main online third party payment platform. In this case, the PayPal platform is widely acceptable and recognized around the globe. This is mainly due to the safety and security features adopted by the PayPal money transfer platform. As such, this analysis argues that the proposed business idea should be limited and based on the use of the PayPal platform as the main payment method in the market. In addition, the proposed idea should apply the subscription approach instead of the per product charges on the customers. In this case, the subscription process is based on the payment of monthly or annual subscriptions in the market (Jackson, 2004, p.83). The use of subscriptions approach is a technology based approach. In this case, each of the customers is allocated an online account and a sign in details. Once the monthly subscriptions are paid up, the customers are provided with log in details that are used as an access code to the system. In this case, the system will use the medium access control (MAC) system. In this case, the MAC system is a technological system and process through which the system creates barriers and systems of approving access. As such, only the authorized persons, with the relevant codes are allowed to access the system. In the EBay Company case study, the MAC control systems will be applied to authorize access to the platform by only the subscribed customers. The use of this system will allow for the development and establishment of firewalls to regulate against the risk of hacking (Khosrow-Pour, 2014, p.89). In this case, the hackers will be insulated against accessing the platform. Moreover, the use of the subscriptions will serve as a platform and system through which to create stable revenue for the venture, while reducing the cost of the overall market products in the market. The rest of the business model system in the market should remain similar to the one applied by the eBay Company. This decision is hedged on the fact that besides the few challenges in the market, the organisational existing model has increased its overall market competitiveness over the last decade. Involvement of New Technology The proposed eBay Inc. Company business idea will apply the Technology Acceptance Model (TAM) technology theory. In this case, the theory holds that users acceptance and the use of new technology information and innovation system is based on two main factors. The factors are the perceived usefulness and the perceived ease of use of the technology in the market. Therefore, the proposed idea is based on these two main elements to facilitate its acceptance and use in the market (White and Bruton, 2011, p.93). On one hand is the perceived usefulness to the customers. Under this theoretical approach, the customers only apply and accept a technology that is perceived as increasing value. Therefore, any new technology should provide new and additional merits that are not present in the traditional market set up. In this case, new technologies are hard to adopt and incorporate in the market. Thus, the users need be influenced by the perceived value addition to its use. In the case of the EBay Company regional online platforms the proposed value addition is on the offering of market specific goods. In this case, the different customer markets globally have different needs, which they often fail to acquire on the EBay platform. This is because, as it is currently, the platform only offers globally acceptable standard goods. As such, regional goods, which are mainly consumed by the respective markets, and often have a low global consumption, are not supplied by the platform. This is because the process of selecting viable products to stock is hedged on their overall global demand and the rate of turnover respectively. Therefore, the proposed platform will create value and usefulness for the customers by increasing specific customers’ variety. In this case, each of the regional platforms will be hedged on providing specific goods that are in demand and consumed within the region. Thus, this increases the overall product usefulness (Mattes, 2010, p.9). On the other hand, the proposed idea will increase the perceived ease of use by the customers. This will be achieved through the use of a local and easy to understand language. Currently, the EBay Company platform uses the English language as its standard language. Although the English language is widely used and acceptable as a medium of international trade, it creates a barrier. In this case, a majority of the platform users are not native English speakers and often have challenges using the platform English directions and features. Thus, this creates a difficulty in the platform use. On the contrary, the proposed regional platforms idea is expected to increase the ease of use. In this case, the platform is aimed at using the local languages as a means of communication on its platform. As such, the use of the local domestic languages on the platform will increase the overall ease of the platform use in the emerging markets. This is in recognition to the fact that although a majority of the nations are conversant and aware of the English language, not all the global nations use English as a medium of communication. In addition, the platforms will all have the alternative of translating the directives and instructions to the English language. In this case, the platform development will provide the feature of the platform translation. In this case, the feature will serve the international customers in such markets, who might not be conversant with the domestic languages. In this case, the features discussed above will serve as a critical tool to facilitating not only the perceived ease of use of the platform, but the actual ease of use in the market. Design prototype, Monitoring, and Evaluation The proposed product idea will be developed for the Chinese market. In this case, the Chinese market is a high market base for eBay, despite the existing market competition by the Taobao Company. As such, the prototype for the proposed idea is the development of Chinese based eBay Company platform. The platform will be monitored for six months to evaluate and gauge on its performance. As such, the progress of the platform will be evaluated against a number of factors. On one hand, will be a comparison of the number of visitors on the platform against the traditional EBay platform visitors in China. In this case, if the prototype attracts a higher number of visitors in China will be an indication of market success. Similarly, the subscription revenues gained in the third to six months will be evaluated against the fees revenues gained over a similar period of time in the traditional revenue model by EBay. The attainment of additional traffic flow and revenue in the prototype will serve as a success indicator, a move that will allow for the development of the other platforms in the global markets. Conclusion In summary, the above analysis establishes that although the EBay Company operations are a success in the market, it requires changes. In this case, the essay recommends the application of the TAM technology and innovation theory. In this case, it advocates for the adoption of a usefulness increase and ease of use regional EBay platforms in the market. References Business Insider, 2014, The Remarkable Story Of How Alibaba Defeated eBay In China. [online] Available at: [Accessed: 2nd December 2015]. Greeven, M., & Yang, S., 2012, How Taobao bested Ebay in China. [Online] Available at: [Accessed: 2nd December 2015]. Heap, E., 2013, eBay sellers beware: Its fees now eat into postage costs. [Online] Available at: [Accessed: 2nd December 2015]. In Huang, R., In Kinshuk, & In Chen, N. 2013, The new development of technology enhanced learning: Concept, research and best practices. HeidelBerg: Springer Publishers Jackson, E. M. 2004, PayPal wars: Battles with eBay, the media, the mafia, and the rest of planet Earth, World Ahead Publishers, Los Angeles, CA Khosrow-Pour, M. 2014, Contemporary advancements in information technology development in dynamic environments. Information Science Reference: Hershey PA Ma, M. 2009, Current technology developments of WiMax systems, Springer, Dordrecht Market Watch, 2014, eBay's annual net revenue from 2004 to 2014 (in billion U.S. dollars). [Online] Available at: [Accessed: 2nd December 2015]. Mattes, J. 2010, Innovation in multinational companies: Organisational, international and regional dilemmas, Peter LANG Publishers, Frankfurt. Pahl, N., & Richter, A. 2009, SWOT Analysis - Idea, Methodology and A Practical Approach, GRIN Verlag GmbH, Munchen Statistica, 2015, Number of worldwide internet users from 2000 to 2015 (in millions). [Online] Available at: [Accessed: 2nd December 2015]. White, M. A., & Bruton, G. D. 2011, The management of technology and innovation: A strategic approach, Cengage Learning, Mason, OH: South-Western. Read More