Kingfisher School of Business and Finance

Lucao District, Dagupan City

1st Semester, Academic Year 2017-2018

Group III

EBay
Prepared by:

Arenas, Sharmila Joy

Cacatian, Joanalen M.

Macaspac, Angelica

Morales, Paulino Paulo III

Pioquinto, Mark Lester

Poscablo, Aila Mariella

Reyes, Joperdave

Tiong, Troi Daniel

Submitted to:

Mr. John Leo Ambuyoc, CPA

I. Problem statement
 1. With the growing popularity of eBay's Same-Day Delivery Service how can the

company step up against its potential rivals in the form of start-ups ready to compete with

eBay?

2. How can the company resolve the challenges of logistical problems like the

necessity for large scale of operations, costs to the company being high, necessity of

employing couriers/pick-up valets, and the success of such a system being dependent on the

acceptance and usage by consumers?

3. Aside from that, faced with this challenges how can the company attain its goal of

aiming to double its active user count to 200 million and expected to report around $21.5 billion

and $23.5 billion in revenue?

4. Finally, with numerous issues regarding eBay's Same-Day Delivery Service , which

is beneficial for the company to discontinue or continue the Same-Day Delivery Service?

II. Problem Analysis

Due to the popularity of eBay's same day delivery, eBay is prone to competitors. It is

easy for other competitors to start up a business and use the same delivery strategy

that the eBay does. Operating a same day delivery is costly and will be needing a lot

of employees to be able to deliver the packages fast and on time. Ebay is aiming a

high revenue and and active users but it is very difficult for them to do that because

there are new competitors arising with the same delivery strategy that the eBay does.

Also, same day delivery risky and double works might happen if wrong things were

delivered because of the time limit they have.

III. SWOT Analysis

STRENGTHS

Largest internet marketplace

The company is a giant matketplace used by more than 100 million people to buy and

sell things to each other.

Brand value

Ebay is the leading global brand for online auctions. The brand has grown

tremendously since its inception.

WEAKNESSES

No further growth strategy

There is not much any plan on how to sustain the growth of Ebay. So, there is high

uncertainty over Ebays future and business direction.

Technological malfucnctions and illegal activities

Since Ebay is an online business, system breakdowns could disturb the trading

activities of Ebay. It is also hard to overcome fraud like counterfeit goods being sold or

theft.

OPPORTUNITIES

Increasing number of online shoppers

The growing number of online shoppers is a huge growth opportunity not only for eBay

but also for PayPal. Online shoppers found it as an easy and convenient way to shop

online.
 New stores moving to eBay

Because of eBays advertising capabilities, wherein they have an easy access or easy

way to reach out their customers, many stores are moving at eBay.

Market Development

China and Europe are wealthy country, there, consumers are becoming richer and

have more leisure time than previous generations. So for eBay to sustain current

growth levels, eBay could expand its market, not only in the two countries stated above

but also to growing economies in Asia.

Market Penetration

Western Europe and the USA still have many potential consumers that have yet to

discover the benefits of online auctions. Remember products have life cycles that

eventually come to an end, and such products are ideal for selling and buying on eBay.

THREATS

Competition

Success attracts competition. International competitors competing in their domestic

markets may have the cultural experience that could give them a competitive

advantage over eBay. Also, Amazons existence along with eBay is a big threat.

Online Security

There will always be a hacker in this type of transaction especially it is online, this will

affect customers mindset whether they should buy and trust eBay or not. As the

technology advances, so does the ability to steal info and encounter a fraud.

Changing exchange rates

When the dollar is appreciating against other currencies, it will affect the profits that

are sent back to US.

Low entry barriers in the industry

 There are stores that have smaller fee to the sellers compared to other stores. This

will also lead to a drive down in numbers of sellers at eBay.

IV. Alternative courses of action

1. How can the company attain its goal of aiming to double its active user count to 200

million and expected to report around $21.5 billion and $23.5 billion in revenue

A. Publication (TV, radio, seminar, and/or Websites/YouTube advertisement)

ADVANTAGE: To attain that 200 million users, eBay must exert a great effort in

introducing its app. America has a great standard of living and their only problem is

what channel they must have and TV commercial is a great way to introduce the app

to the market and the customer just need to be informed efficiently. Radio for the

pedestrian and drivers who dont have time to watch TV shows and get the chance to

be informed by TV commercial and which they also need the convenience that the app

offer. Websites advertisement or the YouTube Advertisement for the Netizen which

they almost use half of their life using these different websites and watching videos in

YouTube. Seminars for the old folks who doesnt find the desire for technology.

Coincidentally, achieving these millions of users will correspond to their expected

revenue.

DISADVANTAGE: The great disadvantage of this action is the great cost that needed

to implement this Publication of the app and the risk if the people will respond and be

convinced to use the app. It can also compromise the expected revenue of the

company because of the cost and maybe the benefit that can be derived from those

advertisement is not enough to compensate the cost.

2. Which is beneficial for the company, to discontinue or continue the Same-Day Delivery

Service?

A. CONTINUE
 ADVANTAGE: In this era of a new generation so called Millennials, a generation who

used internet more frequent than their actual living and this modern lifestyle which all

things are pacing to be instant and fast and convenient transaction is more desirable

by every customer. By continuing Same-Day Deliver Service there are a lot of

opportunity revenue that eBay will gain from the convenience that it offers to the

customer and reduced the negative effect of trade costs. It also gives eBay a great

market segment like the Netizen and using an app can also provide a good marketing

passively to the customer.

DISADVANTAGE: The disadvantage of this Same- Day Delivery Service is the cost

of informing the customers for its existing and the increase in online Trading Sites the

app will only a be an option to the customers especially the market for e-business is

so tight and rapidly growing where the competition is so high. Where the risk of

introducing a new type of technology which not yet know to the market is high.

B. DISCONTINUE

ADVANTAGE: eBay will save the project cost and still use it for other feasible and

economical project in the future and they can avoid the high risk offered by this project.

They can also avoid future technicalities which can cause a bad effect for the image of

the company like the technology malfunction, technology inconvenience and time lag

of effect of this project.

DISADVANTAGE: They lose their chance for the market penetration and the chance

to get the potential customers that the app may bring to the company especially the

market in USA where there are millions of internets user where eBay can show them

the benefit of Same-Day Delivery Service app, the convenience of buying and selling

of products.

IV. Recommendation
The e-commerce industry is becoming increasingly competitive. The company is facing

an avalanche of competition from larger retailers like Walmart and Amazon who are

building up dominant e-commerce sales channels. Ebay needs to take drastic actions

if it wants to stay relevant.

Based on the provided statements, our group proposes that Ebay should discontinue

its Same-day delivery service. This project is high risk and is faced with a ton of

logistical hurdles. The Same-day delivery service could potentially provide more value

to customers but its cost to the company would be insurmountable. It would require

the company an enormous amount of investment since Ebay would need to develop

its own logistical infrastructure.

We also propose the use of both modern and conventional types of marketing. Ebay

could use convential marketing techniques like print and media or it can also resort to

modern types of advertising like Social Media marketing and Youtube advertisements.

The company should also improve its smartphone app because more and more people

are doing e-commerce through their phones. This would allow Ebay to reach more of

its target market and strengthen its overall brand.

Also, the company should strengthen its logistical infrastructure by partnering up with

other companies who provide delivery services like FedEx, UPS and DHL. Partnership

with these companies could yield a lot of synergy. It would drastically reduce the costs

related to shipments and would ensure that the company has the proper infrastructure

to deliver it products to consumers.