There are both online and offline players that E-bay has to compete with for market share. Five Forces Analysis of E-bay Bargaining power of buyers: The company has the capabilities to withstand these forces through competitive advantages Read: Is WikiWealth missing any analysis.
Moreover, this external analysis points to the moderate force that delivery service providers courier companies exert on the industry.
Threat of New Competitors Industry requires economies of scale EBay Economies of scale help producers to lower their cost by producing the next unit of output at lower The following external factors are the main contributors to the strong intensity of competition against eBay: No platform is perfect, therefore there must be a rapid response customer service, for complaints and inquiries to build long-term relationships.
American Society for Competitiveness. Another recommendation is to develop more strategic partnerships with third parties, such as courier companies. High Customers hold enough influence in the online market.
Why is the competition really severe.
So, overall the bargaining power of the suppliers is very limited. These external factors present issues that the company must strategically address. Key Success Factors for Online Auction Firms For any online auction business to succeed, they must bear in mind some critical factors to keep them successful.
Based on this external factor, new entrants need large funds to popularize their brands in the industry.
In the recent years, E-bay seems to have geared up to challenge Amazon. If you have the experience of buying products from eBay, you have been noticing that eBay makes you available a wide array of products to buy to its customers so that they could buy all the products from a single spot that they need.
These forces are a part of every market and industry and this analysis helps brands develop their competitive strengths and make their position stronger.
This analysis shows that the three factors that E-bay must remain most concerned with are the bargaining power of buyers, threat of the new entrants and the level of competition. This limits the bargaining power of the suppliers and keeps E-bay in control.
This helps it adapt to the changing trends. High Customers hold enough influence in the online market.
Every organization will always have its own customers and still make their expected profits no matter how high the competition may be. Competitive rivalry in the industry: This condition intensifies the bargaining power of buyers or customers.
The combined effect of the external factors in this aspect of the Five Forces analysis creates the strong bargaining power of customers. With regard to this Five Forces analysis, eBay Inc.
Bargaining power of suppliers: Educators, Researchers, and Students: To challenge Amazon would not be easy and still E-bay has demonstrated some key strengths, that could help it improve its current position.
Moreover, high economies of scope are a factor that this Five Forces analysis attributes to the weakening of the threat of new entrants. Limited number of substitutes EBay A limited number of substitutes mean that customers cannot easily find other products or services Similarly, the referring sites and Google too hold some clout because they direct searched ad customers towards Google.
In this case, the Five Forces analysis of eBay Inc. In Competition Forum Vol. However, e-bay has become a brand and is a dominant player in the e-retail industry which reduces the clout of its suppliers. Moreover, high economies of scope are a factor that this Five Forces analysis attributes to the weakening of the threat of new entrants.
This external factor is a barrier to entry because new firms likely lack the operational scope to achieve such competitive advantages. Summary & Recommendations: Five Forces Analysis of eBay Inc.
Summary. The results of this Porter’s Five Forces analysis of eBay reveal that competition or competitive rivalry, and the bargaining power of customers or buyers are the most significant external forces in the e-commerce industry environment. WikiWealth's Five Forces analysis evaluates the five factors that determine industry competition.
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An eBay office in Toronto in A Porter’s Five Forces analysis of eBay Inc. points to competition and customers as the highest-intensity forces in the e-commerce industry environment. Find great deals on eBay for Five Forces.
Shop with confidence. eBay Inc. Report contains a full version of eBay’s Five Forces Analysis. The report also illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Value Chain Analysis and McKinsey 7S Model on eBay. EBAY Five Force - Free download as PDF File .pdf), Text File .txt) or read online for free.
The industry’s competitive forces have been determined by examining the Porter’s Five Forces model (See Exhibit 2). In the industry in light, the rivalry is moderate but not too rigorous. Recommendation to eBay to confront the Challenges 5/5(2).Ebay five forces