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eBay's challenges in the online business

Read case and answer these:
1. What are some of the factors that led eBay to enter the online auction market?
2. Describe the competitive landscape of the online auction industry.
3. What are some of the opportunities and threats that eBay faces going forward?
4. What are some of the technology enhancements that eBay has utilized since its inception?
5. Do you feel that the online auction industry has been a viable investment for eBay? How has technology contributed to these advances?

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1. What are some of the factors that led eBay to enter the online auction market?
- The potential income for a online auction market is worth billions because the market is the entire world.
- The concept of a worldwide flea market was so attractive and hard to resist.
- Online auction business operates non-stop (It is a 24/7 business).
- Online business allows customers full service experience where they could bid, purchase, and provide
payments online.

2. Describe the competitive landscape of the online auction industry.

The industry has experienced exceptionally rapid growth since the beginning of the decade, outperforming most retail sectors. As internet use becomes more commonplace, consumers are more comfortable with making purchases online. In particular, internet payment systems have made buying online easier and more secure, helping retailers sway security-minded consumers and attract repeat buyers.
(Additional material: E-Commerce & Online Auctions in the US - Industry Market Research Report, Published on June 2011)

The online auction ...

Solution Summary

This solution discusses eBay's phenomenal success and challenges encountered in the online business.

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