Advantages and Implications of Digital Technology on eBay

This report discusses the advantages and implications of digital technology on eBay. It covers key trends and digital approaches used by eBay, evaluates new business models to solve issues related to digital techniques, and discusses the impact of strategic alliances and cryptocurrencies on e-commerce businesses.

REPORT
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Executive summary
The purpose of this report is to develop understanding regarding the advantages and
implications that invention of digital technology has imposed on businesses. This report discuss
the key trends and various digital approaches that are used by organisations in order to
effectively perform their operations. In addition to this, it discuss regarding the key issues that
excessive reliance on digital technologies has created and how businesses are thinking
constructive solutions to avoid cybercrime and threats related to privacy concerns. Moreover, it
also reflects upon the importance of strategic alliances along with the concept of crypto-
currencies.
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Table of Contents
Executive summary ........................................................................................................................2
Introduction.....................................................................................................................................4
Task 1..............................................................................................................................................4
Task 2 .............................................................................................................................................6
Task 3..............................................................................................................................................8
Task 4 ...........................................................................................................................................11
Conclusion ....................................................................................................................................11
References.....................................................................................................................................12
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Introduction
This report is associated with the concepts related to transformational process of digital
technology which has redefined the course of operations in businesses. Digital business use
effective approaches of advanced techniques and modern platforms and highly relies on
technical inventions for the functioning of their organisation. The chosen company for this report
is eBay, which is an e-commerce business supporting a range of online transactions
headquartered in San Jose, California, United States. In this report, the terms related to digital
technologies and its significance is broadly discussed in context of the eBay. This report
conducts analysis of key trends along with advantages and implications of applying digital
techniques. Also, it evaluates new and emerging business models in solving key issues related to
adoption of digital techniques. In addition to this, it evaluates impact of new collaborative
relationships and strategic alliances along with impact of cryptocurrencies on e-commerce
businesses.
Task 1
Key trends of digital technology are the trends that are recently becoming popular and is readily
accepted in the market or industry. There are various types of key trends such as Automated
Robotic procedure, AI and Machine learning, Side Computing, Augmented and Virtual reality,
Quantum computing.
AI refers to a technology that helps a machine to acknowledge the individual attitudes or
beliefs where as Machine learning which is a part of AI that modify a machine to learn
mechanically from the old data without programming expressly(Kremez, and et. al., 2020) .
Automated Robotic procedure states engineering that is easy to build, deploy, and
manage software robots that imitate individual behaviour and actions. Similar like a normal
human being, robots perform various tasks such as they can acknowledge what is showing on the
screen, they can identify the data and extract it, and can perform various given tasks.
Edge Computing is a technology that enables the users to process the data at the
boundary of the network. It is a basically a procedure that helps the firms applications such as
local edge servers, IT services to get closer to data sources. It is a location sensitive form of
distributed computing and it is expected to improve the responses times and saves
bandwidth(Liu, and et. al., 2021).
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Quantum Computing is a type of computation and a quickly rising technology that
support the laws of quantum that is used to work out the complex question for classical
computers. The devices which uses the quantum computation are called as quantum computers,
though currently this type of computers did not solve the practical problems.
Virtual and augmented reality both are the new technologies and their main activity is to
enhance the real life environment with a artificial surroundings. Augmented reality augments the
whole environment by putting some digital components in the live view whereas Virtual reality
is a environment that is generated by computers with objects and scenes that makes it look like
real.(Gimpel, and et. al., 2018). While both the virtual reality and the augmented reality are
designed to provide a simulated environment to the user, each of these concept or idea is unique
and involves different use cases.
With reference to eBay, it uses AI to auto generate the product description, personalized
search, to upgrade delivery method, translation and more. With the feature of computer vision,
an organization had a specification to add image search in their strengths and enables the camera
phones devices to allow its consumers to use images as a search query (Cappa, and et. al.,
2021) .
The advantages of digital technology in a business such as it improves the productivity, it
improves the customer experience and it increases the digital security(McManus, J., 2021). In
relation with eBay, it has various benefits that are given below:-
 It increases the revenue from new customers, new markets and existing customers.
 It provides better management of marketing as well as customer information.
 It improves the customer service, learnings for the future and feedback from customers
on product.
 It helps to identify new partners and better support for the existing partners.
 It reduces the marketing cost by reducing the time in customer service, by selling the
products online and reducing printing and distribution costs of marketing
communication.
 It also reduces the administrative costs by conducting an efficient routine business
processes such as holiday authorisation, recruitment and invoice payments.
Implications of managing virtual business in eBay is provided below:-
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 The online marketplace can charge commission on every sale that differs from site to site
(Neumeyer, X., Santos, S.C. and Morris, M.H., 2020). Before start selling the products in
this marketplace, a firm must have the wisdom of activities to make a structure on pricing
of products.
 The e-commerce sites can impose restrictive terms and conditions with respect to
communicate with the consumers.
 Due to high volume of similar products on the virtual marketplace, it makes it difficult
for an organization to stand out from the crowd of identical products.
 It requires special finance and accounting because traditional payment system are
inefficient or ineffective for electronic trade and the use of the new payment systems is
complex due to the involvement of legal issues and arrangements on international
standards.
 It changes the nature of supply chains, and provides customized products and services. It
impact the process of supply chain in numerous ways that includes changes in
distribution system, customer orientation, shipment tracking and notice etc.
Task 2
The operations of e-commerce company like eBay use a range of digital trends and
platforms to support its functioning and provide services to the consumers. They relies on
excessive use of technical systems and models in order to conduct their operations. eBay use a
range of key trends and digital systems in order to provide consumers with access to its online
marketplace. With digital techniques serving as a mode of supporting functioning of the
organisation, it implies lack of security or breaching of privacy in many cases (Anderl and et. al.,
2018). The online marketplace make use of complex and high tech digital tools and applications
which are resulting in increase in cases where security of transactions is being compromised both
in context of an organisation as well as individuals. Most of the digital applications and trends
used by eBay are supported with wide usage of internet to perform numerous functions. Internet
of things is super complex and connected to a range of networks increasing risk of its easy
access through everyone. This implies growing attack of hackers creating issue of privacy
invasion for users which is creating threat of data theft and increasing concern of customers to
avail services of eBay. The security issues and privacy concerns oblige e-commerce businesses
such as eBay to pay attention towards eliminating these risks and ensure privacy and
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confidentiality of personal information of individuals as well as of the company. The identified
risks and threats are discussed below in context to the eBay:
Risks of cloud computing: Cloud storage is a digital service which is widely used by e-
commerce companies such as eBay. The functioning of cloud is completely associated with the
use of internet which make it highly interconnected and raise vulnerabilities for users of the
services (Brosinsky, Westermann and Krebs, 2018). While cloud computing supports a range of
storage activities, it also raise privacy concerns through data theft and access of sensitive
information creating risks for company as hackers can use confidential information against the
organisation.
Phishing attacks: This type of attack refers to an online scam which attempts at obtaining
information of users through deception or false pretence. These scams or attacks are increasing
day by day as imposters tries to use personal information of users such as bank details,
passwords etc. in order to gain misleading advantage. Such activities are likely to reduce the
users engagement in availing services of eBay if these scams have taken place while performing
some transaction through online marketplace of eBay. This results in loss of trust and confidence
of consumers in availing services of the business.
Vulnerabilities of software: Software are likely to prone to numerous vulnerabilities irrespective
of their specialised or advanced features creating threats and issues of cyber security. Any error
or mistake could leads to data theft or breach of security resulting in a number of issues
(Inshakova, Ryzhenkov, and Inshakova, 2019). Mistakes through employees in use of IT
software could raise the risk of vulnerabilities and loss of data or access by hackers.
Ransomware: It is emerging as an effective trend which maximise the risk of cyber attacks or
fraudulent activities of hackers. Ransomware is a constantly evolving technique of malware
which is basically designed and created for ensuring encryption of files on a device which makes
them inaccessible to any other individual. Through encrypting files and expecting a ransom
payment for the purpose of decrypting key, it puts the company in a position where they have to
pay ransom to regain access.
Digital business models to cope with challenges of cyber security
E-commerce businesses are highly relied on the application of various digital models and
platforms which implies them to focus highly upon the trends and consider cyber security as a
significant threat which needs immediate attention. In order to reduce the risk of cyber threats,
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the company make effective use of numerous techniques and digital platforms. The activities of
hackers and imposters cannot be eradicated completely from the course of a business operation
such as e-commerce dealer eBay. Due to complete reliance on computerised systems, the threats
cannot be eliminated, however they can only be minimised using effective preventive measures.
The e-commerce business is adopting approaches to maximise cyber security which are
discussed below:
Constructive installation of anti-virus: To reduce the threat of malicious ransomware and other
attacks of hackers, eBay has established potential software in their systems. The company has
developed a system of specific anti-virus programmes in systems of their company which
minimise the threat of hackers (Li, and et. al., 2019). In addition to this, constantly updating
software is extremely significant for the company in order to adopt better techniques in the
system. The ways of cybercrime is evolving day by day which arise the need for constant
evolution and up-gradation of software as well.
Making cybersecurity a top priority through increasing awareness: A number of cybercrime
cases are emerging and reporting as a result of negligence of both employees as well as
customers. It is crucial for the organisation to develop systems which through which constant
reminder could be send to employees and customers. It is often practiced in an organisation that
customers are continuously reminded via messages or online notifications that they should not
share their OTP or any sensitive details like bank accounts to imposters.
Insurance policy regarding cyber liability: These policies reduce the threat for businesses
through minimising the risk by shifting burden of any liability arising to the insurer. This reduce
the risk of financial crisis such as paying ransom to companies through sharing it with third party
insurers (Lucas and et. al., 2021).
Task 3
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Impact of new collaborative relationships and strategic alliances on eBay
Cooperative relationships and alliances has a potential for all small business to expand its
sales and profits because it helps a company to make connections with other firms that moreover
provides new ideas and resources that enables the business to reach at the next level. Various
reasons why an organizational must collaborate are discussed below:-
 It inspires and helps an organization to think in a new better way to try different
techniques and new tools that can save and money of the company.
 It helps firms to grow their networks that however increases the profitability of the
business.
 It provides the companies an opportunity to learn new skills and techniques that can have
a positive impact on the growth of the firm.
In context with eBay the significance of impact of new relationships and alliances
through digital technology with other businesses is discussed below:-
eBay announced its strategic alliance with Microsoft on 12 march 2001, to jointly expand
the business in the global level and improve the e-commerce features for the consumers(Sharp,
D., 2020). These two companies work together to enable the suppliers and customers to interact
with each other across various websites and other apps in all over the world. Initially, the
alliance focused on three most key initiatives that is first, eBay supported Microsoft .NET
technologies, that was one of the sites in the world which is provide as an XML based web
service to web developers . Second, Microsoft had combined eBay marketplace with Internet
service sites in the whole world such as Carpoint, bCental, and Webtv. And the final is eBay had
deployed Microsoft technology including Microsoft passport and Windows 2000 server. The
Microsoft .NET platform will broaden the eBay Application program interface that helps eBay
engines to be accessible to over millions of developers in the worldwide, and also helps them to
provide the service to their users by various applications. Microsoft used the eBay's XML based
web service to amalgamate the trading services of eBay's online market environment into a
number of internet properties including the WebTV services, the carpoint online automotive
service and the MSN network of internet services (Petkova, I., 2018) . These services enables the
customers to easily access the worldwide trading community of eBay within MSN environments.
These services will also going to merged into Microsoft bCentral small business service. With
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this Microsoft services small business merchants has an advantage to expand its e-commerce
features by directly posting their items for sales on eBay websites.
Mobile commerce is wholly changed the way of people shop and pay for their products
and the ways in which merchants of all sizes engage consumers. So, eBay had three UK
companies had done a partnership to deliver the mobile devices with eBay applications. With
this deal, the fastest growing network on the UK that is smartphones started to come with eBay
app in the mobile devices. PayPal has launched a carrier payment network, to make it easy to do
the payments for the consumers. To enable the commerce websites for merchants and carriers,
eBay mobile applications connect the customers to the global network of suppliers(Paunov, C.
and Planes-Satorra, S., 2019). This app helps the consumers to find the products very easily
whatever they want at anytime and anywhere.
Yahoo and eBay formed a strategic partnership that was designed to benefit both the
companies by better serving their merchants, user and advertising communities in the US. This
partnership basically exist with four major elements such as online payments, opportunity to
explore click to call functionality, areas of search and graphical advertising, and a co branded
toolbar. With the implementation of this agreement, yahoo became a third party provider of
graphical promotions through the eBay website and it can help them to expand its service with
the eBay.com online inventory. Both the firms is going to work on developing click to call
technology that is accessible by both the companies. Click to call is defined as a product feature
link that is inside an advertisement that is accessible by the users to directly call that advertiser to
pursue a transaction. The partnership of eBay with yahoo provides a great opportunity to yahoo
to further increase its advertising and sponsored search to reach one of the giant and most active
communities on the websites(AbuRaya, R., 2020).
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Task 4
The concept of Cryptocurrencies refers to the technique of payment which make effective
use of digital platforms in order to conduct transactions. The use of cryptocurrencies has became
an emerging trend in recent years due to its huge significance and the extent of security that it
provides to its potential users (Moratis, 2021). It uses a range of computerised network and serve
as a medium of exchange for transactions. It is considered as one of the most secured method as
it uses complicated algorithms and security protocols while performing transactions. It also
serves a advantage through adjusting prices of the goods and services. In the previous years, the
concept of crypto-currency has became extremely relevant and significance which has created
new ways for businesses and serves as a advantage for the companies. The trend of emergence of
bitcoin has made the process of payment more easy and convenient and helps in reducing the
transaction costs (Pantano, and Vannucci, 2019). With the help of adopting crypto currency
such as bitcoin, it would help the company in assisting transactional purposes and hosting
investments as well as operations. It creates a pool of opportunities for the e-commerce business
such as eBay but it is important to know why an organisation is adopting the use of crypto-
currencies. The adoption of crypto-currencies would help in engaging with more clients and
helps in effective positioning of the company to assure better exchanges with stakeholders.
Conclusion
From the above report, it has been concluded that the use of digital technology and
modern advancements is widespread in operations of an e-commerce business. It has been
analysed that eBay make use of a range of key trends and digital models in order to provide
customers with its services. The excessive use of digital applications creates threats and issues of
cyber security for which the company adopts various models to minimise these threats. The use
of crypto-currencies helps in engaging interaction with more clients and creates a pool of a range
of opportunities for the businesses.
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