Analysis of Digital Technology and Ebay Business Models

This report provides an in-depth analysis of digital business models, with a specific focus on the e-commerce giant, Ebay. The introduction sets the stage by defining digital businesses and highlighting their evolution, emphasizing the shift towards digital platforms and their significance in revenue generation. The main body delves into key trends and advantages of digital technology, including the impact of Artificial Intelligence, the importance of 5G, and the rise of image search and virtual reality. It also explores the advantages of digital technology, such as easy market access, reduced operational costs, and wider customer reach. The report then examines digital business models, particularly the marketplace model used by Ebay, and discusses the importance of cybersecurity, ethical considerations, and customer-centric approaches. Furthermore, it analyzes collaborative relations and strategic alliances, illustrating how Ebay forms partnerships to reduce costs, expand its global reach, and offer a wide range of products. The report concludes by summarizing the key findings and emphasizing the importance of adapting to technological advancements in the digital business landscape.

Individual report

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Key trends and advantages of digital technology........................................................................3
Digital business models...............................................................................................................5
Collaborative relations and strategic alliances............................................................................6
Use of e-commerce principles.....................................................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Digital businesses are the businesses which have the use of technology in order to create
new value to the business model. The customer experience as well as the internal capabilities
makes contribution to support the core operations of the business. Digital business comprises of
the organisations which run on digital only platforms as well as the organisation which
transformed their business to digital techniques. Now a days people are spending most of their
time surfing online, this has shifted the ways of working a business and has put more importance
to the digital platforms and sources to earn the revenue. Digital business have evolved a lot in the
past few years from just selling products online (Khin, and Ho, 2019). One such digital company
is Ebay. This company has established itself at a good place in the market. Ebay is used to buy
and sell electronic items, cars, fashion apparel, sporting products and anything else which people
are looking to buy on the online platforms. Ebay has excel itself in covering a wide range of
categories for the products and has succeeded in attracting more and more customers coming
from different demographics.
MAIN BODY
Key trends and advantages of digital technology
Technology has evolved a lot in the past few years with a rapid speed. It helps in
changing the pattern fast and increase the progress in the way. Staying up to new and updated
technology related trends is very important for the companies running in the modern market
world. It helps in keeping the focus on future and developing accordingly. Some of these digital
technological trends are:
Artificial intelligence and machine learning: Artificial intelligence have created a lot
of buzz in the market place. It is the most popular and important digital technology trend as it
effects on how the people live and work in the initial stages (Pagani and Pardo, 2017). The
importance of Artificial intelligence is shown well in having a superiority in the images, the
speech recognition system and navigation applications are extremely helpful. Along with this, AI
also helps in analysing the interactions of people which is very useful in determining and
building the connections. This helps the companies like Ebay to predict the demand and needs of
their customer base and improve their services accordingly. AI helps in the authority of the
company to make better decisions related to the resource allocation and studying the changing

patterns of the customers. The behaviour of customers changes every time, AI helps in analysing
the data by making them enhance the personal life experience. Machine learning is the sub-part
of AI and is used in almost all type of business industries, especially in e-commerce business.
5G: The applications and benefits of 5G are in the ears of people from past very long
time but the demand to finally use it has increased a lot during the time of remote working.
Video conferencing and digital collaborations have become important parts of the lives of people
which have lead to the urge of having a reliable connectivity and bandwidth (Dornberger, 2020).
The business of Ebay relies on the working of phones, tablets and related other devices which
has increased the number of internet of numbers, also written as IoT sensors which has
highlighted the need for multi lane superhighways. Businesses like Ebay cannot take a chance to
be disconnected and thus the use of 5G have become a very important part as the solution to the
existing problems. 5G services are predicted to revolutionise the lives of humans.
Importance of image search: This trend in the digital technology helps in having a
incorporate image search technology on the company's online site helps the customers to have an
easy picture of the products they are looking to buy and with the help of that picture, they can
find the similar examples available on the company's site (Giones, and Brem, 2017). It helps in
attracting customers to the site by having a pricing strategy which is having the interested
product with a less price will help the company to potentially pick up the sale and generate and
extra revenue system.
Virtual reality: This trend has lead its users to have the experience the enhanced form of
environment. They help the customers to experience before they invest in the product. There are
many different forms of technology which are incorporated in the current and future human life.
Virtual reality has played a very important part in training, entertaining, education and even in
the process of marketing the products and services.
Advantages of using digital technology and managing the virtual business includes
having easy access to the market place and easy reach to the customers. Online market place
such as Ebay allows any person to have an online setup and to either shop or sell the products in
very less time. Working the business on digital terms makes the selling which avoids the need
for having an expensive retail store which involves having a customer facing staff and sales staff.
It allows Ebay to invest more in the marketing and having great customer experience on the e-
commerce site. Working a digital business eliminates the constraints coming from the traditional

methods to the business such as searching and paying more are not the important consideration
in the digital business. Companies like Ebay which has a good marketing strategy on digital
platforms help in fulfilling the demands of the customers and boost the sales. In physical stores,
the business of the company is restricted to that particular location but in the digital business the
the products and services are not limited to the customers based on their geographic terms. This
also helps in attaining a wider customer base which helps in increasing the sales of the
customers. It is the advantage of the digital businesses to expand their market beyond the local
customers in a very quick way.
Digital business models
Digitalisation has become very popular in the lives of human people and thus in the
business market place. With the era of digitalisation, the businesses have also been shifting
towards the digital approach and the models for business are new and merging. These business
models helps in improving the capability as well as the profitability of the company in large
extents while making the use of resources in an effective way (Ghobakhloo, 2020). The
companies like Ebay that have their business on the online platforms have to become more
careful regarding the need for the cyber security. It is very important for the company to prevent
from having any threats regarding the data and information stored on digital technology. There
are many hackers just ready to get access to all these crucial information of the company and its
users. Cyber security is collaborating with the new business models to avoid having any security
breakdowns. These digital business models helps in a defend against the hackers present. In the
modern business world it is important for the companies to follow the ethical and social
responsibility while operating their business. If not so, then will lead to bad reputation and
decrease in the sales. Ethics is very important for the digital operating companies to being
responsible and following the best approach for digitalisation. Business models helps in keeping
the focus on customers. The use and advancements of the technology has changed the behaviours
of customers which has lead to increase in the demands for changing the models in order to meet
the desired needs. In order to be successful, many companies have tried to combine their
business models and follow different models for every department of the company.
They play major role in the success of the companies such as Ebay. The business models
used by Ebay are the marketplace model. This model has a great way of disruptive potential.

Market place business model is used mainly in the digital market place which helps in
connecting the seller and buyers on the same platform (Lund and Tyson, 2018). The revenue is
earned with the help of brokerage fees, getting the commissions and also by having a fixed
transaction costs. Addition to this, market place business model allows the use of membership
fee on different platforms in order to generate the money with the helps of sources such as
advertising and premium positioning of the company's services. Another business model is the
pyramid model which is basically a sales model which is in existence from past some years. It
helps in attaining easy approach to the billings with the help of technical aids. Pyramid business
model can be quickly built and is very easy to manage. This models helps in generating more
profit margins on the products which is very easy to explain. Ebay uses platform business model
which helps the company to measure success which is related to the different successful
transactions which exists close to the market place. This business model enables having more
value to the company with the help of better interactions with people and groups of people and
then leveraging the effects of networking.
Collaborative relations and strategic alliances
Most of the organisations in the market place are trying their best to overcome from the
factors of the bas economy. Economies of the country is going down with many other factors
such as recession, Brexit effect and so on. Due to all these factors it has become important for the
companies like Ebay to have collaborative relationships and forming new strategic alliances in
the operation of their business and taking care of the needs and demands of customers (Sousa
and Rocha, 2019). Ebay has formed the alliances with the help of some sellers and respected the
importance of collaborations. These collaborations helps ebay to cut the extra costs while
improving the services provided by the company to its users. Ebay is an open source of e-
commerce platform which allows anyone to sell their product and follow the consumer to
consumer as well as business to consumer approach in their business. This company offers a big
platform which is safe and secure which with the help of collaboration helps in selling its product
globally while being very seller convenient. The strategic alliances of Ebay has made the
company connect with the sellers present all around the globe which gives the company global
recognition and not limitations regarding the demographic views. The profits coming form these
collaborations are equally shared between ebay and the other sellers. The use of strategic

alliances and having collaborations with the sellers have given the company the way to succeed
and an organisation culture where sellers from small to some of the large companies work
together offering wide range of products and even so many options for the customers to buy from
(Wirtz, 2019).
Ebay allows the sellers to sell a already used product on their site which makes the
customers purchase the used product in very less price than the original product. This makes the
company gain competitive advantage and growth in their sales. The company has partnered with
many market place sites such as stubhub which allows the sports fans to sell or purchase the
tickets to the sport they are interested in. Not just the sports but also the concerts, movies, and
many other events. this is very safe site and very reliable for the customers (Park, and Mithas,
2020). The classified websites of the ebay has its presence in the entire world and is very helpful
for people in trading at local level. The revenues in this case are generated with the help of
advertisements. Ebay has also made strategic alliances with the half.com which is used to sell
used books and video games on the Ebay's site. Running an online business requires to be
technologically updates with the digital forms of payment. This online payment method must be
safe and secure in the ways which customers can rely on. Ebay has collaborated with some
payment applications because of which, customers buying from Ebay can have many options to
pay. These alliances helps the individuals to have a quick send and receive payments with the
help of online modes and operating in many number of different markets. The new trends of the
market and advancements in the technology along with having such wide range of products have
made it very hard for the companies like Ebay to survive and handle all things alone. Therefore it
is important for them to form new strategic alliances and build new collaborative relations. A
well set alliance with the company pushes Ebay to do and perform better.
Use of e-commerce principles
The industry of e-commerce is growing in this modern business world as the people
browsing through the internet has increased. Offering the best quality product is very important
when taking the business online. Ebay uses many e-commerce principle to be one of the best in
the e-commerce industry and drive the sales on the company's online site (Remane, and et.al.,
2017). Ebay has done its best in the field of business to consumer and consumer to consumer
with its top notch business model. Ebay runs on the most competent business model which

allows the one on one trading chance in the form of conducting an auction. Ebay has laying its
hand on the e-platform with its exceptional services in the complete of trading experience. The
company is very much focused on shifting its ways to the renewable sources used for electricity
in the offices and many other things. It helps in working in a socio and environmental friendly
way.
User - oriented approach: The mission of ebay is to provide the best services to its
users. The company has set its place in the e-commerce industry and e-market place with the
help of their outstanding dedication and determination to fulfil their goals (Ismail, Khater, and
Zaki, 2017). They company is following the practice of being more user friendly by developing
and improving their site. Following these principles will give ebay the leading company in the
market place of virtual and digital business. The site allows remarkable number of appraisals
with infinite number of available products. Ebay is also the best approach for the new people
entering the business world and gaining the economic opportunity for this ultra competent
business world.
Customer enabled commerce: Every business works on having a kick start approach to
the commercial purpose. Ebay works with a business idea which is out of the box and helps the
people to carry on with e-trading and e-commerce activities. This will help Ebay to provide an
edge for working along with the sellers and not having any problems against it. The great service
by Ebay provides more area to have more personalised experience from buyer to seller and vice
versa. The ecommerce business Ebay is a form of an open source which allows no heavy efforts
in giving power to the users with regards to the trading. It thus, help in opening the door for
many economic opportunities.
Transforming passion into sales: The company provides a large category to its users.
Using the digital technology in the ecommerce business helps in providing the way to transform
passion of individuals into a business opportunity. When a seller is looking to generate an
additional source of income, a new entrepreneur is looking for business opportunities or even a
multinational company wants to expand their client base, Ebay is there for everyone standing
with them to make their business flourish through the online site of Ebay (Rangaswamy, and
et.al., 2020). It whole process is used to make the customers thrive and does not leave anything
behind. Ebay’s working principle is to create an economic opportunity which makes its users to
contribute on the overall economic graph.

Philanthropy: The working principle of ebay does not stop at being a successful
ecommerce company but addition to this, they also have their hand in some charitable projects.
The business of ebay is based on the principles of exhibiting ethical values as well. This makes
the reputation of the company become much more better in the eyes of its customers. Ebay is
members of several organisations on online platforms (Holotiuk, and Beimborn, 2017). The
company is coming out as a responsible member in the country. Company has helped in rising
several amounts of charity funds and apart from this, it is also supporting the new and budding
entrepreneurs which impact many numbers of lives on a global scale.
Efficient call to action: The main of ebay is to increase the conversion rate which will
help in increasing the revenue of the company. Here, call to action becomes very important. In
the case when the customers are looking to find the solutions of their problems, it is important to
see if the words used by them on the call to action tab are leading them towards correct question
and its solution (Li, 2020). This helps in creating high efficiency and the use of words in more
focused about the action driven verbs. This helps in boosting the conversion rates and makes the
customers happy and satisfied with the service.
CONCLUSION
It is concluded that digitalisation is going to be the main way to perform the business and
traditional methods will not be that profitable. Digital technologies and its advancements have
wooed over the new as well as the elderly generation of the world. This is the initially phases for
the ecommerce businesses which are expanding day by day with the technology. Digital
businesses like ebay offer more options for their customers and mainly do not have a limitation
on the geography basis. The help of technology in the digital business can lead to fasten the
process of being a successful company. The digital trends in the market are very important to
understand before starting the digital business. It can be seen that these trends brings in many
advantages for the digital business. Companies like ebay have to adapt to many new business
models which are related to the digitalisation in order to avoid cybercrime and work ethically.
Lastly, there are some ecommerce principles which are used to improve the business and
achieving more customer satisfaction.

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