Detailed Analysis of eBay's International Business and Global Strategy

This report provides a detailed analysis of eBay's international business operations, focusing on its foreign market entry strategies, business model, and competitive environment. It examines eBay's online business model and licensing strategies for global expansion, highlighting the company's ability to leverage internet adoption and build a substantial customer base. The report also addresses the competitive dynamics eBay faces, including challenges related to static GMV levels and brand positioning, and explores how the company utilizes artificial intelligence and big data to enhance customer experiences. Furthermore, it assesses eBay's organizational structure, knowledge management practices, and innovation initiatives, emphasizing the importance of personalized shopping experiences and data-driven decision-making in maintaining its competitive edge in the global marketplace. The report also identifies key competitors like Amazon and Alibaba and analyzes the factors influencing eBay's revenue and market position.

Running head: INTERNATIONAL BUSINESS ANALYSIS
INTERNATIONAL BUSINESS ANALYSIS
Name of the Student
Name of the University
Author Note

1INTERNATIONAL BUSINESS ANALYSIS
Executive Summary
The report is based on the analysis based on a major multinational enterprise named eBay
that has been able to maintain its profitable operations in the industry. The foreign market
entry based strategy that has been implemented by the firm and the business model have been
discussed in the report in detail. The competitive environment that is developed within the
industry and the competitive dynamics have been analysed on the report. The analysis has
also provided details based on the structure of the organization, the levels of innovation and
the knowledge management activities that have been developed and implemented by the firm.

2INTERNATIONAL BUSINESS ANALYSIS
Table of Contents
Introduction....................................................................................................................3
About the company....................................................................................................3
Foreign market entry strategy adopted by eBay............................................................4
Competitive dynamics and the market conditions faced by eBay.................................5
Competitive landscape faced by eBay.......................................................................7
Organizational structure, knowledge management and innovation in eBay..................8
Innovation in eBay...................................................................................................10
Conclusion....................................................................................................................11
Reference List..............................................................................................................13

3INTERNATIONAL BUSINESS ANALYSIS
Introduction
A multinational corporation (MNC) or a multinational enterprise (MNE) can be
defined as the corporate organization that mainly owns and controls the production process of
services and goods in a country that is not the home country of the firm. The two major
characteristics that are displayed by the MNEs or multinational enterprises are mainly based
on the large size and a fact that the operations of the firms are controlled centrally by their
parent organizations. The MNEs are able to develop a global presence in many different ways
that are able to provide major benefits to the economies of scale (Agarwal and Wu 2018).
The expenditures that are made by the organizations in research and development are also
considered to be an important factor that has an impact on the multinational enterprises. The
report will be based on the detailed analysis of a multinational enterprise and the methods
that it had implemented in order to expand the operations. The organization that has been
selected for this analysis is eBay and the study will provide details based on the methods
implemented by eBay to enhance global presence levels (Aggarwal et al. 2016).
About the company
eBay is an organization that has been able to develop a mission which is considered to
be bigger than a particular moment. The firm mainly aims at creating growth opportunities
for everyone. The organization has also formed an inclusive and diverse workforce and aims
at reflecting the customer and form a position of the firm as well (Ebay.in 2019). eBay has
been interested in developing a positive effect on the society with the help of its operations.
eBay has gained the position of the biggest online marketplace in the world. The sellers who
are a part of eBay website range from the small hobby based sellers to the mom and pop
business firms to the giant firms as well (Ebay.in 2019).

4INTERNATIONAL BUSINESS ANALYSIS
Foreign market entry strategy adopted by eBay
As discussed by Alden and Nariswari (2017), the online business model has been
implemented by eBay in order to increase the presence of the organization in different parts
of the world. The company has always aimed at entering various countries with the help of its
website and various products that are offered to the customers. The strategy of eBay has been
able to play a major role in improving the ways by which the firm has been able to enhance
the profitability levels and increase the customer base as well. The market entry strategy of
online business has been helpful for the organization to increase the awareness related to its
operations in various parts of the world (Boso, Hultman and Oghazi 2016).
eBay has been able to maintain the operations and levels of profitability with the
support that is mainly offered by the wide variety of products and services. On the other
hand, the market entry strategy of licensing has also been implemented by eBay in order to
provide chances to various organizations to sell its products with the help of its website. eBay
is also able to provide a platform to the eBay in order to maintain the operations in an
effective manner. The company offers a chance to the small firms so that they are able to sell
their products to the desired customers (Chen et al. 2015).
According to Dinu (2016), licensing can be defined as an agreement that is developed
by an organization in order to transfer the rights of selling the products and services to the
customers. This is considered to be a highly useful strategy for the purchaser of the license in
order to gain a larger share in the market within short period of time. Licensing process can
be used in order to maintain the process of marketing and production within the organization
or the industry as a whole. The licenses are mainly provided to the various small
organizations to sell the products that they manufacture to the customers in different parts of
the world (Cuervo-Cazurra 2016). The agreement is also developed with respect to the needs
and demands of the customers and the organizations as well. eBay aims at maintaining its

5INTERNATIONAL BUSINESS ANALYSIS
position in the industry with the help of proper process of licensing that is implemented by
the small firms. The various products that are offered to the customers with the help of the
website of eBay can reach the customers within a short period of time (Elter and Ulset 2017).
Competitive dynamics and the market conditions faced by eBay
The strategy that has been implemented by eBay is mainly based on the ways by
which the organization is able to take advantage of the increased levels of adoption by the
customers of internet. eBay has been successful in the development of a customer base of
more than 160 million active buyers in the year 2017. Around two-thirds of the total number
of transactions made by the customers of the organization are considered to be international
in nature. The challenge that is faced by eBay with respect to the increased growth of
business operations in based on the static GMV levels (Gomes, Carneiro and Dib 2018).
The brand positioning strategy that is implemented by eBay is related to the proper
usage of traditional media. The digital channels that are used by eBay are mainly based on
the levels of impact that they have on the ways by which perception of the brand can be
changed in an effective manner. The purpose that has been developed by eBay mainly states
that “pioneer new communities around the world built on commerce, sustained by trust, and
inspired by opportunity (Ebay.in 2019).” The current marketing based approaches that have
been implemented by the organization are able to play a major role in helping eBay to
maintain its operations in the industry (Gulanowski, Papadopoulos and Plante 2018). The
proper exploring of Artificial Intelligence and Big Data are able to play a major role in the
ways by which eBay has gained success in the operations. The mission statement of eBay is
stated as,
“To deliver the most relevant shopping experience, we continue our efforts to better
understand, organize and leverage eBay’s inventory (Ebay.in 2019).”

6INTERNATIONAL BUSINESS ANALYSIS
The data initiative that has been implemented by the firm is mainly based on proper
maintenance of the huge inventory of eBay around the various products. The firm has thereby
continued to increase coverage of the structured data that mainly enables proper creation of
customer experiences. The demand and supply based information is able to play a major role
in the ways by which various products are offered to the customers with the help of the
website of eBay. The proper coverage of structured data is considered to be a major factor
that has an impact on the experience of the customers (Hitt, Li and Xu 2016). Consumer
experiences that are offered by eBay are important factors that have an impact on the proper
achievement of the goals. Personalized shopping based experience that is offered by the
organization is able to play an important role in proper development of the consumer base of
eBay (Jiang, Holburn and Beamish 2016).
The revenue model that is formed by eBay is based on the earnings that have been
gained with the help of commissions on the completed sales and proper listing of the products
as well. More than 80% of the total sales of eBay are received from selling of various new
items. eBay has also been charging commission fees based on transactions that are made by
the customers with the help of PayPal (Leonidou et al. 2015). The marketplace of eBay is
mainly known in the industry for core services that are able to enable the sellers in order to
list the items for selling. Artificial intelligence has also been implemented by eBay in order to
enable the personalized shopping activities that provides help to people in order to find the
best levels of deals (Khojastehpour 2015).
eBay had implemented major levels of changes in the marketplace of business in the
year 2008. The changes that have been implemented by the organization are mainly based on
three major areas that include, seller incentives, fee based structure and feedback as well. The
changes are mainly related to the ways by which the organization aims at increasing the sales
levels in an effective manner (Mohr and Batsakis 2018).

7INTERNATIONAL BUSINESS ANALYSIS
Competitive landscape faced by eBay
eBay faces direct competition based on the online auction based services that are
offered to the customers in various countries. Many indirect competitors are also an important
part of the operations that have been developed by eBay in the industry. The different
channels that have an impact on the competition faced by eBay include offline and the online
retailers, liquidators, distributors, auctioneers, import and export based companies, mail order
companies and catalogue, directories, search engines, offline and online commerce
participants and the various offline channels as well (Morbe 2018). The major competitive
factors that are able to influence proper development of the operations of the business are as
follows,
 Ability based on attracting, retaining and engaging the sellers and buyers.
 Volume of the transactions and the price and the selection of goods as well.
 Trust on the transactions and the sellers.
 Brand recognition and customer service (Noe et al. 2017).
Amazon has gained the position of biggest competitor of eBay in the industry based
on the listings of the products on the website of the firm. The merchants and the consumers
can also use the websites in order to sell the different goods. The different alternatives that
are provided to the sellers in order to offer the products to customers include Alibaba,
Amazon (Panhans and Kaufmann 2018).
The various competitive factors are able to affect the ways by which eBay is able to
maintain the levels of revenues in the industry for a longer period of time. The competitive
factors that support the operations of eBay are as follows,
 Ability of attracting, retaining and engaging the customers.
 Volume or levels of the transactions and proper selection of the goods.

8INTERNATIONAL BUSINESS ANALYSIS
 Trusting the sellers and the transactions as well.
 Customer service.
 Brand recognition.
 Community cohesion, size and interaction.
 Mobile platform, website and application.
 Reliability and security of the system.
 Reliability of the delivery and payment that include customer preference
related to the increase in delivery speeds of the firm.
 Levels of the service fees.
 Quality of the search tools (Ral-Trebacz and Eckert 2016).
The competitors and various organizations in the industry have been implemented in a
huge manner by the advent in levels of online auctions. The small traders or firms have
developed the car boot sales in order to reach the customers. The retailers like Vodafone on
the other hand have used eBay for distributing the various products that are a part of the
product range (Parente, Geleilate and Rong 2018).
Organizational structure, knowledge management and innovation in eBay
The aims that have been formed by eBay are mainly based on the enhancement of the
levels of gross merchandise based volume and the net revenues that are gained in the
marketplace of eBay. The detailed objectives that are mainly related to proper achievement of
the strategies and aims of eBay mainly focus on the following,
 Acquisition – This is considered to be a process that is implemented in order
to increase the number of users who have been newly registered on the
marketplace.

9INTERNATIONAL BUSINESS ANALYSIS
 Activation – Increasing number of the registered users who have been able to
become the active buyers, sellers or bidders on the marketplace of eBay.
 Activity – Increasing value and volume of various transactions that have been
conducted by each of the active users who are a part of the marketplace of
eBay (Reardon, Coe and Miller 2015).
The focus that has been developed by eBay on the three major areas that mainly vary
with respect to the various strategic priorities that have been developed in the local markets.
The growth that has been gained eBay in the marketplace in mainly driven by various
approaches in order to enhance the performance in various areas (Panhans and Kaufmann
2018).
 First, the growth of a category was mainly achieved with the increase in the
number and size of different categories of the products that are mainly offered
to the customers.
 Second, the formats for the proper interaction. The stores of eBay were mainly
developed in order to enable the sellers with the help of a wide range of
products in order to showcase the products in an effective manner (Wu and
Gereffi 2018).
eBay has aimed at implementing high levels of localization in order to offer various
products to the customers. The various localized marketplaces of eBay mainly include
Australia, Austria, Canada, Belgium, Singapore, Spain, South Korea, France, Hong Kong,
Germany, India, Ireland, Switzerland, Malaysia, Netherlands, Italy, Philippines, United
Kingdom, New Zealand and United States. The organization aims at optimizing the different
factors related to growth with the help of usage of proper opportunities and improvement of
the performance as well (Gomes, Carneiro and Dib 2018). The growth based strategy that is

10INTERNATIONAL BUSINESS ANALYSIS
developed by the firm is also considered to be an important factor that helps in increasing the
levels of investments on the ways by which customer experiences can be improved
effectively. The support that is provided by the company to gain trust of the customers is
mainly based on increasing the product offerings in the industry (Elter and Ulset 2017).
Innovation and Knowledge management in eBay
eBay has been able to maintain its operations in the industry with the help of proper
levels of innovation that have been implemented in the firm. The concept based on auctions
has been improved and re-established by eBay in order to apply technology in an effective
manner. The proper facilitation of e-commerce is considered to be an important factor that
has an impact on the auctions that have been made by the organization. eBay has been able to
evolve its operations for a mere auction site to a global commerce and payments based
platform (Hitt, Li and Xu 2016). The three major business units of eBay have an impact on
the operations of the firm and the levels of profitability that have been gained as well. The
business units that have been developed by eBay mainly include eBay, that is one of the
biggest marketplaces in the world, PayPal that mainly enables the individuals and the
organizations to send and receive the digital payments in an effective manner and eBay
Enterprise that mainly enables the omni-channel commerce, digital marketing and
multichannel retailing for various global enterprises in the United States (Deloitte.wsj.com
2019).
eBay has currently developed the mission that is based on meeting the rising
consumer expectations for the multiscreen, seamless shopping based experiences. The
acquiring of organizations and exploring various emerging technologies in order to offer the
new services that are able to satisfy the shopping preferences of the consumers. The New
Ventures group and Innovation of eBay is mainly dedicated to the development of future and
also testing the new technologies in an effective manner (Deloitte.wsj.com 2019). A major

11INTERNATIONAL BUSINESS ANALYSIS
technology that has been recently developed by eBay is mainly named as “Connected Glass”
that helped in leading development of the “digital storefronts” or the “shoppable windows”.
Acquisitions have also been able to play a major role in proper development of the innovation
based strategy of eBay in the industry. eBay has taken pride in the proper integration of the
companies in ways that are helpful for them to retain the innovative cultures in an effective
manner (Parente, Geleilate and Rong 2018).
The effort that has been implemented by the firm is based on connected employees
from different companies that are acquired by eBay. eBay has always aimed at the
appointment of entrepreneurs in the leadership positions of the firms with the aim of proper
improvement of the revenue levels. The start-up based incubator programs that have been
developed by eBay are considered to be major parts of the innovation based facilities. The
innovative ideas have been developed by different firms are mainly based on the hack-a-
thons that are arranged for proper identification of the top talents (Mohr and Batsakis 2018).
The slowing growth based issues that have been faced by eBay have been solved I an
effective manner with the support that is provided by proper knowledge management. The
proper development of competitive edge in the industry is also influenced in a huge manner
by the support that is offered by knowledge levels of the organizations that are a part of the
website. The processes and people of the firm have been able to play a major role in
managing the growth levels of eBay in the market (Boso, Hultman and Oghazi 2016).
Conclusion
The report can be concluded by stating that the operations that have been developed
by eBay are mainly based on the strategies that are implemented by the firm. The growth
strategy and expansion of the organization is mainly based on the proper development of an
effective online business model. The licensing process has provided a major platform to