Marketing and e-commerce - Essay Example

Executive Summary: E Commerce is a concept that is gaining popularity in the current century. Most companies, in a bid to get competitive advantage over rival companies, normally use the internet for purposes of advertising their products. The evolution of online payment system, such as Pay Pal and Money Brookers has also made it possible for e-commerce to thrive. eBay is an example of an online company, that acts a market place for the sale and purchase of products. This is through the internet. With its acquisition of Pay Pal, the company manages to be a leader in the provision of online auction services. Table of Contents: Executive Summary Introduction………………………………………………………………4 Background………………………………………………………………5 Data Collection……………………………………………………………8 Findings……………………………………………………………………11 Conclusion…………………………………………………………………13 Bibliography……………………………………………………………….14 Appendixes………………………………………………………………..15 Introduction: E-commerce is an example of an industry, whereby trades and consumers buy services or products through the use of electronic systems, like computer networks, or the internet (Laudon and Traver, 2005). In the modern times, E-commerce involves the use of the World Wide Web, in its transactions, and this involves using a wide range of technological innovations such as the social media, emails, mobile devices, and telephones. Collier (2009) reveals that electronic commerce is the backbone of the e-business, and this is because it is impossible to conduct an e-business without the use of electronic gadgets such as computers, or even mobile phones. E-business also involves an exchange of data, for purposes of facilitating the payment and financing of certain aspects of a business transaction (Laudon and Traver, 2005). It is important to understand that e-Business is a very efficient and effective method of communicating in an organization, and a very reliable and effective method of carrying out a business operation (Laudon and Traver, 2011). Scholars denote that e-Business is an example of a marketing strategy, whereby the company under operation, enters into a business environment without necessarily having a physical presence (Collier, 2009). (Laudon and Traver, 2005). This paper is a report, and it concerns itself with analyzing the use of an online website that is responsible for facilitating the selling and buying of products and services. The organization under consideration is eBay, and it operates the following website, www.ebay.com. eBay, is a multinational company, and it offers consumer-to-consumer online business services (Cronan and Matthews, 2008). This report examines the actually need of the services provided by the website, and whether the website under consideration manages to satisfy the identified needs. Data used in developing this report is mainly collected from interviews, which have been in depth, and the target population that the researcher used is male people, who are in employment, and aged between 25 to 35 years of age. The researcher will have to interview this people, for purposes of evaluating the impact of eBay in influencing their attitudes and behavior. Background: History: eBay began its operations by the brand name of auction web, in the state of California, the city of San Jose. This was on 3rd of September 1995. The founder of eBay was Pierre Omidyar, a computer programmer, who had an Iranian-American nationality (Cronan and Matthews, 2008). Auction web began as a hobby, were Mr. Omidyar could write his personal feelings, among other issues that affected the society, this also includes trade. However, the website began engaging in commerce, and a breakthrough came when auction web was able to sale a laser pointer which was broken. The bidder bought this broken laser pointer for us dollars 14.83 (Mennecke and Strader, 2002). Omidyar was surprised at this deal, and he repeatedly asked the winning bidder if he had knowledge that the laser pointer under consideration was broken. In a corresponding email, the buyer denoted that he was well aware that the laser pointer was broken, and it was his business collecting broken laser pointers. Despite this development, auction web remained a side hobby for its founder, Mr. Omidyar (White, 2002). This is until, the internet service provider he had ascribed to required him to upgrade his account to a business account. This is because auction web was attracting a lot of traffic, and as a result, Omidyar had to pay a fee of $ 250, up from $ 30 a month. On this basis, Omidyar was forced to charge people using its website; as a result, he hired Chris Agarpao, as its first employee (Mennecke and Strader, 2002). Chris Argapao was responsible for handling cheques that came in as fees, from users of the account. In 1996, auction web hired Jeffrey Skoll, as its president, and in November of the same year, auction web entered into a partnership with electronic travel auction, for purposes of using their Smart Market Technological system (Laudon and Traver, 2011). The intention of auction web was to use this technology for purposes of selling travel products, and plane tickets to its users. In 1997, the growth of the company was great, and this is because the company was able to facilitate a whooping 2000000 auctions, when this was compared in 1996, which the company was only able to host 250,000 auctions. It is during this year, that the company decided to change its name from auction web, to eBay. Originally, the domain name of ebay.com belonged to the consulting firm of auction web, by the name of Echo Bay Technological Group. In the same year of 1997, the company was able to acquire a capital of $6.7 million, from Benchmark Capital, and in 1998, the company hired Meg Whitman, as the CEO, and president of the company (Laudon and Traver, 2011). At this point of time, the company had an employee base of 30 million people, and commanded a user base of half a million people. During this point of time also, the company was making revenue of 4.7 million dollars. In 1998, eBay was enlisted at the stock market, and on the first day of trading, the company jumped from a share price of dollars 18, to a share price of dollars 53.50. This made Omidyar, and Jeffrey Skoll, instant billionaires (Cronan and Matthews, 2008). In 2000, the expansion strategy of the company continued, and it began selling any item that is saleable in the market place. In 2002, the company bought iBazar, a European auctioneering website, after which the company bought PayPal, an online payment system (Mathews and Mathews, 2004). By 2008, the company had a worldwide presence, with millions of registered users, and an employee base of over 15,000 people. Competitors of eBay. One of the major competitors of eBay is uBid. uBid was formed in 1997, and it also runs an auction website. The organization allows users to sale products through the internet, and it can also sale its own products, through the internet. It is important to understand that ubid.com specializes in the sale of consumer products, such as home appliances, watches, electronics, computers, jewelry, and cellular phones (Shim, 2010). Unlike eBay, users of uBid must gain approval before selling any product through the platform. This is for purposes of avoiding the sale of counterfeit products, stolen products, or even illegal products. uBid is the closest competitor of eBay, and it controls an approximate market share of 15%. The websites stock valuation stands at 2 billion US dollars. Another significant competitor of eBay is bidz.com. Bidz specializes in the online auctioning of jewelries, and this includes watches, wedding rings, bangles, gemstones, etc. This company is a leader in the auctioning of these jewelries, and on this basis, it is a worthy competitor of eBay (Turban, 2010). Consumers. It is important to understand that eBay is a multinational company, and on this basis, it has numerous customers, based on the market segmentation of a country of their operation (Cronan and Matthews, 2008). However, most consumers of eBay are young people, who are under the ages of 25 to 35 years of age. Most of its consumers do not have children, nor do they have any college experience. It is important to also understand that most of their customers are Caucasians, commanding a house hold income of 100,000 dollars (Sinclair, 2005). Of late, eBay has embarked on a policy aimed at attracting older people, aged between 50, to 55 years. This is because they have a stable source of income, and they have numerous house hold goods that they may have the desire to sale. Data Collection: During the process of data collection, the researcher used the interview research methodology. The use of interviews was beneficial to the researcher, and this is because it is a primary method of collecting data. This enables the researcher to get information, from people who have experienced the services of the company, and on this basis, they will offer information based on knowledge derived from their experiences (Kumar, 2011). Interviewing is also beneficial, and this is because the researcher will have the opportunity to record the information, and hence chances of distortion are minimized, during the process of data analysis (Kumar, 2011). The use of an interview is also beneficial, and this is because the researcher will manage to obtain an in depth information concerning the perceptions and attitudes of the interviewees, in regard to the use of the ebay.com website. The questions asked in the interview, and their results are found at the appendix section. Sampling: While choosing the participants of the interview, the researcher will use the social media to look for people who have at one point used the services of eBay. Thereafter the researcher had to use the random sampling techniques, to choose ten people, who are located near the researcher for purposes of inviting them for an interview. Based on this technique, the following are people that the researcher interviewed, only their first names will be identified, and this is for purposes of maintaining confidentiality, as part of a good ethical procedure, John: John is a thirty year old Bachelor and a structural engineer by profession. He has used eBay on two occasions, one was to sale his personal computer, and another occasion was to buy a used refrigerator. Tony: Tony is an accountant by profession, and he uses eBay on most occasions, to purchase electronic product. His latest purchase was an iPad gadget. Joseph: Joseph is a student, and he uses eBay on most occasions to sale his products, as well as buy products from the site. He is 25 years old. Jack: Jack is a plumber, and he is a fan of eBay. Most of his products are used materials, and he bought them from auctions, through eBay. Jack is aged 29 years old. Maurice: Maurice is a teacher by profession, and he is 34 years old. Maurice has used eBay once, while purchasing a used personal computer. He does not intend to use the services of the organization again. Bernard: Bernard is also a teacher by profession, and he on most occasions uses the services of eBay, to buy, as well as sale electronic gadgets. Bernard is 27 years old. David: David is a student, and he uses eBay services on most occasions, and that is in buying and selling products, especially electronic products such as computers and mobile phones. David is 31 years old. Morgan: Morgan is a 27 year old mason, and he used eBay on one occasion, that is while selling a personal computer, and he does not intend to use it again. Ernest: Ernest is 30 years old, and he is a plumber by profession, he has used eBay once, and that is by selling his mobile phone. If a chance occurs again, Ernest intends to use the services of eBay again. Oliver: Oliver is a carpenter by profession, and he is 34 years old. He is a regular user of the services provided by eBay. Findings and Implications: From the results of the interview, most of these people were satisfied by the services offered by eBay. The interviewees denoted that the services of eBay are created and tailored for purposes of satisfying their needs. For instance, most of those interviewed denoted that .eBay has a user interface that is easy to use, and post any advert for the sale of an item. This is as compared to the services offered by uBid, the main competitor of eBay (Cronan and Matthews, 2008). uBid requires its users to follow a vigorous process of posting items for sale, and this normally discourages most sellers. The products sold at eBay are also cheap, and there is a photo that describes their quality. On this basis, since the users of this website are looking for used products, they normally get satisfaction on the products they buy. eBay also has a policy of describing the faults of the products auctioned at their website, and the choice of the online payment system (Turban, 2010). On this basis, chances are minimal that a customer might lose his or her money. Based on these strengths of the organization, most of those interviewed denote that they gained satisfaction through the services of eBay, and hence it is a fantastic online business organization. It is important to denote that even those people who denoted that they would no longer use the services of eBay, their reasons was not because of the inefficiency of the companies services, but their desire to use a one on one business dealings (Cronan and Matthews, 2008). This is because they would like to know the person they are engaging with in the business transaction. In as much as users gained satisfaction in this online auction business, they were dissatisfied by a number of issues. One such issue is the exaggeration of the quality of a product under consideration. Most users denote that sellers of products normally exaggerate on the quality of the product, and hence the management of eBay has to initiate a policy of checking the product under consideration, before allowing a seller to post an advert (Turban, 2010). Failure to create such a policy, eBay may lose its customers to uBid, which has a policy of checking the quality of a product. From this research, it most of those interviewed supported this concept of e-commerce. In their perspective, e-commerce is an important concept, because it makes it easy for companies and individuals to carry out a transaction. Take for instance eBay, whose existence has made it possible for individuals to press a button, while purchasing a product, or selling a product. There are a variety of implications for the evolution of e-commerce. One implication is that companies will be able to increase their revenues through the online market. Take for instance, a company such as eBay, which just began in 1995, and within a short period of time, the company became a market leader in the auction business. This was made possible because of innovation, and new technological inventions, such as Pay Pal, and the social media platforms. Pay Pal made it possible for online payments, while the social media made it easier for the company to reach a wide audience through advertising. On this basis, companies will seek to use the electronic media for commerce, and hence increase their market share. Conclusion: In conclusion, eBay is a good company, and an example of a successful online company. The company is the biggest online auction company in the world, having a presence in Africa, Asia, Europe, and America. The operation of eBay has been possible, and this is because of the emergence of new technologies in information technology, and the social media. It is important to denote that most users of eBay are able to derive satisfaction from the products they buy from this company, and the online platform that it offers sellers of these products. Bibliography: Collier, M. (2009). EBay (6th ed.). Hoboken: For Dummies [Imprint]. Cronan, J., & Matthews, C. B. (2008). Ebay quicksteps (2nd ed.). McGraw Hill: San Francisco. Kumar, R. (2011). Research methodology: a step-by-step guide for beginners (3rd ed.). Los Angeles: SAGE. Laudon, K. C., & Traver, C. G. (2002). E-commerce: business, technology, society. Boston: Addison Wesley. Laudon, K. C., & Traver, C. G. (2011). e-Commerce 2012. Upper Saddle River, N.J.: Prentice Hall ;. Matthews, M. S., & Matthews, C. B. (2004). eBay. Berkeley, Calif.: Osborne/McGraw-Hill ;. Mennecke, B. E., & Strader, T. J. (2002). Mobile commerce technology, theory, and applications. Hershey, PA: Idea Group Pub.. Shim, J. K. (2010). The international handbook of electronic commerce (Rev. ed.). Hawkhurst, Cranbrook, Kent [England: Global Professional Pub.. Sinclair, J. T. (2004). EBay business the smart way maximize your profits on the webs #1 auction site (2nd ed.). New York: AMACOM, American Management Association. Turban, E. (2010). Electronic commerce 2010: a managerial perspective (Global ed.). Upper Saddle River, N.J.: Pearson Education. White, M. (2012). Buy it now: lessons from eBay. Durham: Duke University Press. Appendix A: Questions that were asked in the interview: i. Have you heard of eBay? ii. Have you ever used the services of eBay? iii. What benefits did you derive by using the services of eBay? iv. What challenges did you encounter by using the services of eBay? v. Will you ever use the website again for transactions? vi. If not, what are your reasons? Read More