Ebay's Failure in China

6789 Words28 Pages
International Strategy eBay’s failure in China 1 Table
of
contents
 2
 Introduction........................................................................................................................................... 2
 3
 Theoretical
background .................................................................................................................... 3
 3.1
 The
SWOT
Analysis......................................................................................................................................3
 3.2
 The
Porter’s
5
forces ...................................................................................................................................4
 3.3…show more content…
what
 is
 the
 appropriate
 organizational
 structure
 to
 support
 the
 configuration
 of
 the
 MNC
 (PORTER,
 1986).
 Furthermore,
 a
 company
 has
 to
 determine,
 in
 respect
 to
 its
 industry,
 the
 optimal
 trade
 off
 between
 global
 integration
 &
 local
 responsiveness.
 The
 standardization
 vs.
 localization
 trade
 off
matrix
has
lead
to
4
international
approaches:
International
Exporter,
Global,
Transnational
 and
 Multi‐domestic
 (PRAHALAD
 &
 DOZ,
 1987
 /
 BARTLETT
 &
 GHOSHAL,
 1989).
 Two
 frameworks
can
be
useful
for
companies
in
this
case:
The
OLI
framework
identifies
the
firm’s
 motivation
 for
 becoming
 a
 MNC.
 Furthermore,
 the
 AAA
 framework
 helps
 companies
 decide
 how
to
expand
their
business
abroad.
 Where
–
Should
companies
start
operations
in
large
markets
or
the
familiar
ones?
On
which
 terms
 should
 companies
 based
 judgments
 about
 investing
 in
 foreign
 markets?
 ‐
 The
 CAGE
 framework
 helps
 companies
 in
 evaluating
 the
 proper
 opportunities
 in
 foreign
 markets,
 compared
with
the
respective
costs
and
risks
that
might
occur.
 The
focus
of
this
paper
is
to
understand
and
analyse
the
key
drivers
behind
why
eBay1
has
 experienced
failure
in
China
and
success
in
the
UK.
Our
analysis
will
be
supported
by
a
SWOT
 analysis
and
a
5
Porter’s
forces
analysis,
as
well
as
by
the
frameworks
mentioned
above.
 1
EBay
Inc.,

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