Question

What are the problems that eBay is currently facing? How is eBay trying to solve these problems?

Answer 1

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eBay is an international consumer to consumer corporation founded in 1993 by a French born Iranian-American computer programmer as an auction house. In 2011 the company had revenues of $11.7 billion and is one of the leading internet sites featuring an on-line website that has both auction and “buy now” offerings.

eBay is having problems with increasing revenue.  They moved eBay “away from its origins as an online flea market” and stared “partnering with retail chains to simply serve as another channel for current merchandise.” It still remains a trusted online brand and they are still working to improve its market offerings.

The three big challenges currently facing eBay are:

1) selling via mobile devices,

2) the legal challenges to PayPal, and

3) the prospect of collecting sales tax.

The key problem is continuing to drive revenue growth. eBay’s revenue growth had stalled in part because the small retailers using eBay could not generate the sales volume eBay requires. As a result, eBay has shifted to emphasize larger scale and professional large volume retailers. Moreover, eBay has had to overcome its own brand: widely known as an auction site, it was initially difficult to create a new brand image more similar to Amazon’s as a site which sells just about everything at a fixed price. However, eBay is continuing to move in that direction, and successfully: it now derives 70% of its revenue from traditional e-commerce.

The largest threat to eBay is the honesty and integrity of its auctions, over which it has some – but not total – control. As eBay ventured into the realm of higher-priced antiques and collectibles, it opened itself up to lawsuits from buyers claiming to have been defrauded by online sellers. Some buyers have alleged that eBay does not do enough to prevent unscrupulous sellers from collecting inflated fees for goods that are not legitimate, or worse, do not exist.

eBay users have also been the victim of identity theft scams that resulted unauthorized use of their accounts -and hundreds of thousand of dollars worth of fraudulent sales.

With online crime becoming more and more sophisticated, the onus is on eBay to provide its users with a secure trade environment. Some users, and former users, believe that the company has not adequately addressed the issue of fraud. The growing scale of eBay makes fraud protection prohibitive.

• The largest threat to eBay is the honesty and integrity of its auctions, over which it has some – but not total – control. As eBay ventured into the realm of higher-priced antiques and collectibles, it opened itself up to lawsuits from buyers claiming to have been defrauded by online sellers. Some buyers have alleged that eBay does not do enough to prevent unscrupulous sellers from collecting inflated fees for goods that are not legitimate, or worse, do not exist.
  
  eBay users have also been the victim of identity theft scams that resulted unauthorized use of their accounts -and hundreds of thousand of dollars worth of fraudulent sales.
  
  With online crime becoming more and more sophisticated, the onus is on eBay to provide its users with a secure trade environment. Some users, and former users, believe that the company has not adequately addressed the issue of fraud. The growing scale of eBay makes fraud protection prohibitive.

• Another area in which the sheer size of eBay may be a hindrance is customer service.
  
  When eBay Store fees were raised, some 7,000 storeowners shut down their stores and looked for other means to conduct their business.
  
  There are many possible outcomes from the problems which eBay is taking in to consideration like: -
  
  eBay monitor every transaction and usage statistics in real time, enabling timely troubleshooting.
  
  In 2001, the company launched eBay Stores, eBay Stores enable sellers with a proven tack record, a verified ID, or a PayPal account to set up an online storefront and offer fixed-price merchandise
  
  
  
  
  
  
  As there are many cases of forgery cheques and demand draft one case which is mentioned in the case also for the possible solution eBay has purchased Paypal, Paypal is online money Transfer Company which gives security to seller of the goods for its payment.
  
  As if we analyze the case we can clearly see that eBay is trying its hard to face the problems and for their possible solutions.
  
  If we see in the latest technologies which are available in the market then eBay is require to invest some what money to make its transactions secured and trustworthy. EBay can ask for more proof and identity for its registered customers and time to time verifications of those ID proof etc. For eg. Some times telephone companies also do the same things after a certain period of time they ask from their customers to resubmit their ID proof etc. to verify that the documents are same which they have submitted while taking the connection or not. This can be a way to make the transactions secured because transactions are done by customers and if their documents are legally ok then their will not be a case of forgery.