EBay & Yahoo
EBay belonged to an otherwise chaotic market, time pacing is important in the sense that any mistake that could impact real-time interfaces could affect the credibility of the company (Eisenhardt and Brown, 2008). Indeed, there are specific times when eBay was not able to respond to the ever-growing demand of traders as evident by 22 hours downtime mainly because of server problems leading to the crashed of the website in 1999. This had made eBay believed that advantage is indeed temporary and so the need to continuously look for new source of advantages (Brown and Eisenhardt, 1998).
The sense of urgency was thereby developed but eBay was realised to be lacking strategic capabilities of responding to changes during that time especially because eBay was attempting to do all things at the same time. For instance, the website crashed due to the fact that the auction house is managing the processes of flow of users on the site, processing new members, accepting bids and managing huge database of list of categories while also integrating new products and services information.
Nevertheless, when problems like this occur, eBay acts promptly and respond through adding workforces whom will oversee specific functions while also avoiding problems such as thisIn continuously evolving to be the business of tomorrow, eBay could still rely on its business model but could also consider expanding it. Black (2007) mentioned that e-commerce is becoming increasingly important to consumers, sellers, and entire communities and online marketing has become and will continue to become a full and complete business model for other companies.
The increasing importance of e-commerce and the use of the Internet, led many online companies, such as eBay to engage in online auctioning. Ten aspects are attributed to the success of eBay, namely, commitment, well-spent funds, an effective and persistent marketing and public relations, great products or services to sell, not selling of junk, great customer service, efficient and pleasant facility, polished listings and photos, paying attention to details, and good recordkeeping (Mansfield 2006).
These ten aspects are perceived to be contributory to the success of eBay in the industry as the leading online auction house, and determine its edge over its competitors. The success of eBay has inspired other online companies to engage in the same business, of perceiving the same attention that it receives from consumers. With this, several competitors can be pointed out, which are also online companies that engage in the same services that eBay offers.
Amazon. com and Yahoo! Auctions are the two main rivals. Amazon. com was the second largest online auction house, which is perceived to be a competitive threat to industry leadership position of eBay, is also a one-stop-shop online auction site. Compared to the business model of eBay which is trader-centric, that of Amazon. com’s is more inclined as profit-oriented. On the other hand, Yahoo!
Auctions was the first online navigational auction house over the Internet, a reputation that sets its identity apart from the other two main auction houses. The advantages of eBay over Amazon. com and Yahoo! Auctions are three-fold: wider portfolio with over 3, 000 categories, low to zero transaction costs and information-support, manifesting that changes inside eBay are diverse and emergent (Brown and Eisenhardt, 1998).
In comparison with perhaps Fable, this report maintains that although eBay has proved to be lacking in strategic time pacing at certain point, experimentation and regeneration have been the survival strategies. Fable was more focused on short-term successes, missing the opportunities for new products growth. In opposite, one of the primary objectives of eBay was to strengthen products and services portfolio as evident by the incessant acquisitions of alliances and partnerships to boost categories and site features and functionality.
Compared to Fable which is highly dependent on ‘repeated layering’, eBay is an epitome of a well-developed organisational structure where the top management especially Pierre was willing to accept what he cannot do for eBay and resorting to seeking the help of strategists such as Skoll and Whitman. For eBay, change is an opportunity that must be taken advantage instead of seeing it as a threat (Brown and Eisenhardt, 1998). Finally, Fable was not able to reap the benefits of changes but for eBay, the company is equipped with the capability to transition while maintaining a superior performance.
EBay is well aware that in order for the company to maintain its competitive advantage and make it sustainable in the long run, the company must take advantage of the changes at the corporate, organisational and business levels. EBay embraces the five building blocks which are applied randomly throughout eBay’s history: improvisation, co-adaption, regeneration, experimentation and time pacing as evident by the strategies discussed. The company also embraces the 10 principles of competing on the edge about strategy, organisation and leadership.
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