Introduction
eBay is an internet company (from America) that was formed in 1995 (Collier, 2004, p. 7). It manages a shopping website and an online auction that allows for the buying and selling of a broad variety of goods and services. The company seems to be the main success story of the recent dot.com bubble. It currently operates a large business that is estimated to be located in over 30 countries.
To achieve its current success the company was able to expand from its original auction to allow for other new and innovative products (Collier, 2004, p.2). In expanding its business the company introduced new items like online advertisements, standard shopping, online money transfers and online event ticket trading.
As a matter of fact its business has in recent years continued to grow considerably as it now has a global presence. This global market is very challenging but the company has withered all storms to remain competitive with good market and business strategies.
Discussion
It can not be denied that the company has been successful because of its core competency. This has more or less been related to their overall strategy. Their core competence has been their innovative idea of offering auction services online (Martin, 1995, p.14).
This business has been reinforced by the use of a high level of technology that is always a driving factor in business. Embracing of technology goes in line with their chosen strategy of using technology supported by the internet to conduct business. Acquisition of pay pal has also helped to boost and reinforce its core competence.
Currently the company has its core competency in its name recognition and the high website traffic that it seems to have (Walton, 2006, p.3).
Whenever the company has witnessed high traffic it has brought in a large number of buyers and sellers. In the long run this has availed an array of goods and services for the customers to choose from. This is also their chosen strategy to provide a large pool of products and services.
The value chain (of the company) has been the activities that it has been involved in to ensure that its business is successful. It has been able to design and plan its activities and business in various perspectives. This has been by listing many items to be bought or sold on a daily basis.
In addition, its various sites have allowed people to trade in their local currencies (Porter, 1996, p.19). This has in the long run increased its business activities. To ensure that the company adheres to the right ethics of business it has terms of service agreement that defines the way it relates with other people.
eBay’s value chain can be said to virtual. This is because it is their basis of competitive advantage and it has also been responsible for superior value creation in a long way. Virtual value networks have allowed the company to create a new basis by which value can be created and enhanced.
The management has been able to stay in control of all the activities in a very effective and less costly manner than the normal way of conducting activities in business. Core competencies of the company have had a very big possibility of being leveraged in a broad perspective which has done it a great deal.
eBay’s strategy has been their innovative idea of offering auction services online (Spencer, 2006, p.6). This business has been reinforced by the use of a high level of technology that is always a driving factor in business. In addition, the company has been able to expand from its original auction to allow for other new and innovative products.
In expanding its business, the company has introduced new items like online advertisements, standard shopping, online money transfers and online event ticket trading (Spencer, 2006, p.16). This was its core business strategy since it was established and even going back ten years ago. The company has continued with this path albeit with more improvements and reviews. This has been necessitated by the ever increasing competition from other companies that are in the same business.
There are many challenges that the company might face in future in relation to their strategy. The implications of these challenges mean that if the company does not become vigilant in moving ahead with new innovative products it might be faced out of the market with the increased and vibrant competition.
It also implies that the company has to invest a lot in research to continue enticing the market and fulfill the high expectations from customers. The future will only be favorable for those companies that continue using the internet in a more innovative way which poses a big challenge to the company in remaining globally competitive.
Conclusion
To achieve its current success the company (eBay) was able to expand from its original auction to allow for other new and innovative products. In expanding its business the company introduced new items like online advertisements, standard shopping, online money transfers and online event ticket trading. Currently the company has its core competency in its name recognition and the high website traffic that it seems to have.
Reference list
Collier, M. (2004). eBay For Dummies. USA: John Wiley.
Martin, J. (1995). The Great Transition: Using the Seven Disciplines of Enterprise Engineering. New York: AMACOM.
Porter, M. E. (1996). What is strategy? Harvard: Harvard Business Review.
Spencer, C, M. (2006). The eBay Entrepreneur. UK: Kaplan Publishing.
Walton, K. (2006). FAKE: Forgery, Lies, & eBay. USA: Simon Spotlight Entertainment.