Why Ebay Lost to Taobao in China - the Global Advantage

In addition to this massive information highway, there are many different tools that can be utilized on this global network.Using the Internet, people find jobs, send electronic cards, shop, make airline and hotel reservations, execute stock trades, and even pay bills online!With the increasing popularity of people shopping and purchasing goods online, the Internet has created new ways of doing business. Realizing the potential of the Internet, many companies have started to advertise their products and services online. However, consumers are becoming hesitant as it relates to purchases over the Internet because of the fear of being deceived by online retailers. The research study will examine a prosperous component of the Internet, Internet

Read the case carefully and answer the following questions: 1.Till 2005, eBay EachNet was the leader in the Chinese e-commerce market, controlling more than half of it. But eBay EachNet soon lost its market leadership position to Taobao.com (Taobao). In this context, analyze the reasons that can be attributed to Taobao’s edge over eBay. 2.a. To enable people to trade with each other, Pierre Omidyar created a marketplace in September 1995 which was later called eBay. By mid 1997, eBay received one million page hits per

Electronic commerce has been there for a long time now, and it is a practice that is practiced by peoples from Germany, France, and the US on a daily basis. Since its inception around 40 years ago, e-commerce has continued to grow as innovations, technologies and a lot of business reverting to the use of the e-commerce. The aspect of buying and selling of goods in the early 1960s was sluggish with the traditional way of mailing of documents being replaced with the Electronic Data Interchange (EDI), which would later pave a way to the electronic commerce. After the e-commerce, however, the practice was not more reliable as it still had many challenges (Tsolis, 2009). For instance, it was not easy for buyers to see products from the comfort of their homes and more so, the methods of accessing the information were limited.

The buyers and sellers must trust the e-commerce’s computing environment and the infrastructure. If they do not feel comfortable or trust security of the infrastructure he or she will not buy the product he or she was looking to buy (Turban, King, McKay, Marshall, Lee, & Viehland, 2008). There are two ways to increase trust in e-commerce the following are: 1.) Affiliate with an objective third party. This builds trust by putting hypertext links on their website to other trusted reputable companies. 2.) Establish trustworthiness through these key elements integrity, competence, and security (Turban, King, McKay, Marshall, Lee, & Viehland, 2008).

By the year of 2006, eBay’s combined international investments in Latin American, Europe and Asia Pacific has totaled revenues of 2.1 billion, representing 49% of aggregate revenues of the company at the time. Seeing the great potential of the Chinese C2C online auction market which back then comprised of 250 million customers, eBay has launched various attempts majoring the acquisition of EachNet in 2003 and the later joint venture with TOM

The Alibaba group has thrived in the Chinese e-commerce sector from its inception in 1998. They currently account for over 70% of online shopping in China and delivered annual revenues of $636 million in the 12month period ending June 2009 (case p1-2). Alibaba’s successes are due to multiple factors that have allowed them to create corporate advantage, and thus establish market leadership in China (Case p1). The configuration and coordination of Alibaba’s

The continuous development of Internet leads to the growth of e-commerce. The electronic commerce is growing constantly due to the continuously increasing number of mobile and online users in the market, primarily the emerging markets. Besides that, the development of the Information Technology (IT), such as the advance of paying processes and the improvements of shipping method also the main reason to cause the growth of electronic commerce (John Ingham, 2015). Most consumers accept e-commerce as their feasible alternative in the purchase of goods and

Founded just before the turn of the millennium in Hangzhou, China, Alibaba Group has to date become the largest online retail website worldwide in the planet, its total transactions surpassing the sum of both Amazon and eBay’s (Erickson, 2013). The report explains its business and operation model and market strategy, before moving to explore the reasons for Alibaba Group’s success such as its established market share in the large market of Mainland China and its efforts to promote the perception of the reliability and security of e-commerce. Comprising of its future plans in logistics improvement, expansion into developing nations, integration with social networks, venture into mobile

There are totally no more than 14 Chinese listed e-commerce companies. In order to clearly determine the research objectives, this paper has to explain that those companies, such as e-banks, are involved in the e-commerce services, while they are not classified into the e-commerce industry in the paper. This paper has totally selected these 14 listed e-commerce companies as research samples. These Chinese e-commerce companies mainly offer services in the mainland of China, but they choose to be listed on different stock exchange, such as Shanghai, Hong Kong, NASDAQ or New York

The re-expansion of eBay into China seems to be a viable probability and a part of the companies plan for the near future. In 2002, eBay established a presence in china with the acquisition of leading auction site Eachnet to form eBay Eachnet. Up until 2005 eBay Eachnet was the leader of the ecommerce market due to their C2C platform. However, with the emergence of Alibaba owned subsidiary Taobao.com (Taobao), eBay Eachnet soon lost its stronghold on the market. This factor combined with a rigid Chinese ecommerce market drove eBay to withdraw business dealings in the country in 2006.

As ubiquitous as eBay is to Americans, it is only a few decades old. eBay was created back in 1995 in San Jose in the living room of founder Pierre Omidyar with his partner Jeff Skoll and it was envisioned to be a marketplace for the sale of goods and services for individuals (Bjornsson, 2001). Meg Whitman was eventually brought onboard to sustain the success and to help hone a better vision for the company: "that eBay is a company that's in the business of connecting people, not selling them things" (Bjornsson, 2001). Part of the widespread success of eBay was founded in the principle that it was not just about auctioning off collectibles, but in upscale markets as well and in creating solid partnerships with brands like GM, Disney and Sun (bradeis.edu). In spite of those tremendous accomplishments, the real success of eBay is in its trading community on the Internet and making it a marketplace that is safe and regulated. "Buyers and sellers are brought together in a manner where sellers are permitted to list items for sale, buyers to bid on items of interest and all eBay users to browse through listed items in a fully automated way. The items are arranged by topics, where each type of auction has its own category" (Bjornsson, 2001). However, despite the massive success that eBay has had in America and in other regions of North America, it has struggled in other marketplaces around the world; something which was indeed a surprise

    Assessment of eBay´s choice of market entry strategy for China, listing both the advantages and disadvantages of its acquisition strategy Assessment of the potential benefits and risks of eBay´ s joint venture with Tom Online Assessment of both companies: eBay and Tom Online, decisions on their respective percentage of stake

When network entered into people 's daily lives, people started to go shopping online and concern the risk of third-party payment platform. Third-party payment platform is based on trust and a third-party payment platform needs more time to build independent agencies to pay trading platform. Third-party payment is not a financial institution, it builds a connection between merchants and banks as banks and merchants as technical support services and credit guarantees while facilitates public payment and reduces transaction costs. With the development of online shopping transactions, third-party payment platform generated and plays a vital role(Wang and Zhu, 2014). It is not only to the success of every transaction but also much money related to a range of security and social stability. According to a formal statistics, China 's third-party payment platform transaction amount has got 274.3 billion yuan, more than 976 billion yuan in 2007 181% in 2008(Wang and Zhu, ibid).

The first action for both eBay and Taobao in China is to identify their target markets. When eBay launched in China, it identified its target customers as those “well educated, familiar with the Internet, earning a monthly payment over 3,000 RMB, and 20-40 years old” (Chen et al., 2007). Indicated by Shixiong Wu, CEO of eBay China, these mainstream customers are very important to eBay as they help with the healthy growth of electronic market (as cited in Chen et al., 2007). On the other side of the Chinese online market, Taobao decided to focus on Chinese customers who are between 20 and 30 years old with good education levels, after analyzing China’s C2C market for four months. They believe that in a decade, these online shoppers will become mainstream consumers who will influence the buying habits of the whole country (Alibaba, 2006). Comparing the target markets of eBay and Taobao, it is clear that though they all target at young people, Taobao’s target market is much broader and includes students, while eBay’s target customers are professionals who have salaries. Shown by the survey results, in 2007, student buyers made up a quarter of all customers,

Online shopping is a form of electronic commerce which provides the way consumers go shopping and purchase services and goods with reasonable price on the Internet. For some consumers, shopping and purchasing online have become part of their daily lives, while others may not even care about it. Taobao online shopping system has provide consumers to directly buy goods or services from a seller over the internet using a web browser.