Ebay.S Strategy in China Alliance or Acquisition

Table of contents Introduction 3 E-Bay Company 4 The Chinese opportunity 6 The main problem 8 Tom EachNet 11 Benefits 11 Risks 12 Critics 12 Conclusion 14 References 15 Introduction E-Bay was the first company that made possible to sell products on the internet. Nowadays, internet takes a huge place in business activities and not only for B2C or B2B business but also in C2C. This last point is the main activity of E-Bay. But this system buyers and sellers never meet, they exchange money for goods and E-Bay doesn’t have to be involved in the most important and expensive part of the e-commerce (or e-business) which is shipping the product (this part is the responsibility of the seller). E-Bay, and in general, all the†¦show more content†¦In fact we can notice the increase of such services. People used more and more platform in order to sell goods or by it to other consumers. Even if internet is used by a small part of the population (4.6% in 2002), it represented in 2002 the same number than in US with 59.1 millions of connected people. In 2006, the penetration rate was 10,6% of the population so 137 millions of people and about 31.5 of them shop online for reaching a turnover of $2,9 billion. But the problem is the Chinese market is affected by a slow internet speed, a high internet access cost, an imbalanced economic and technological development in some regions, an absence of reliance in credit system for online payments, corruption, currency problems and a miss of legal transparency in making business online. For this reasons, , E-Bay introduced the Chinese market by taking interests in a local online auctions company called EachNet and by fully entered on it in 2003. EachNet got the same activity as E-Bay and was equipped by a rich business knowledge, a strong domestic and international experience and a well-though strategy. This concept was mainly used by Chinese early adopters because of the trading culture focused on a combat between retailers and customers to get the best deal, the concept looked such as bizarre. The start-up succeeds on it by adapting the business model of E-bay to the Chinese customers such as payments systems, demographics and customer behaviours. ForShow MoreRelatedUnited States and Strategy1355 Words   |  6 Pagesby a full acquisition a year later in 2003. Critically assess eBay.s choice of market entry strategy for China (use Key Country Matrix), listing both the advantages and disadvantages of its acquisition strategy (use Drivers (YIP) -CAGE Matrix). 30% Assess the potential benefits and risks of eBay.s joint venture with Tom Online (use Global/Local Matrix)eBay first entered the Chinese market in 2002 by acquiring a 33% stake in its local counterpart, EachNet, followed by a full acquisition a year later