In 2003, Alibaba.com launched Taobao.com to compete in the general consumer online auction market against eBay in China. After four years of an intensive and expensive battle, eBay withdrew from China completely.
In about 200 words, describe the advantages Alibaba.com might have had over eBay in this new market, and then describe the advantages eBay might have had over Alibaba.com. Be sure to discuss lock-in effects where appropriate.
Alibaba has advantages over eBay. Alibaba is already well known in their country. Alibaba’s Fees were not charged for online auctions. Alibaba offers free listings, local servers, and more localized features. Alibaba is using the strategy, Market Segmentation. They a great strategy of developing great acquisitions with other leaders in the industry such as Yahoo China.
The ecommerce market in China is growing and Yahoo being a global company with influence puts Alibaba is the position to control a large percentage of a Chinese market. EBay had a few advantages over Alibaba as well. EBay has a better Branding. Over the years, the company has built a strong brand, currently the brand value stood at $12.9 billion and was ranked 54th in brand value rankings.
EBay’s internal strengths have focused on a swift increase in the number of users and number of product listings. It is well known to cater to everyone. EBay has a Wider larger market along with Better and bigger clients.
EBay’s strong customer base and market position provides competitive advantage and gives EBay considerable bargaining power which will have a positive impact on the top line of the company. EBay also has more experience than Alibaba, especially when it comes down to their online auction market.
The Essay on Ebay Target Market
With the rise of smart phone technology, even the Baby Boomers are catching on to the trend. Roughly about 15% of smart phone users are over 55 years old and with the rise of computer tablets, it provides this generation with an alternative way to access the internet. This generation has many characteristics that would help eBay to expand their market even more. Since Baby Boomers are independent, ...
