Overview of eBay Inc

“Overview of eBay Inc. and Insights on Consumer Behaviour

and Buying Preferences for Lifestyle Categories”

Presented by

SANAM DASDepartment of Fashion Management Studies, NIFT, Kolkata

A presentation on

Objectives

To give an overview of eBay Inc. and eBay India. To explain the business model of eBay Inc. To explain the functions of eBay India. To discuss the insights on consumer buying behaviour in watches

and mom and baby products. To explain the average selling price of the products. To suggest new strategies for improvement of the organisation.

E-Commerce in India

India first came into interaction with the online E-Commerce via the IRCTC.(2002)

In 2005 eBay entered the Indian e-commerce market.

In 2007 Flipkart introduced itself to the Indian market and gained popularity soon.

Reasons for Growth of E-Commerce in India

Increasing broadband Internet and 3G penetration.

Growing Living standards

Availability of much wider product range

Busy lifestyles and lack of time for offline shopping

Increased usage of online categorized sites

Evolution of the online marketplace model with websites like eBay, Flipkart, Snapdeal, etc.

Challenges for E-Commerce in India

Lower average broadband speeds compared to other countries.

High failure rate of online payment transactions.

Lack of access to free internet facilities in public places like airports, trains etc.

Lower margins for e-commerce companies could be a potential threat to their survival.

eBay Inc.

Company OverviewBusiness ModelOrganisational StructureFunctions

eBay Inc.

American multinational corporation and e-commerce company, providing consumer to consumer & business to consumer sales services via Internet.

Founded by- Pierre Omidyar Founded- 3rd September, 1995 Headquarter- San Jose, California Chairman- Thomas Tierney CEO- Devin Wenig Type- Online Retailing Website- eBay.com, eBay.in

eBay India

eBay entered in India in 2004 by acquiring baazi.com.

India’s leading e-Commerce marketplace.

eBay India has 2.1 million active users from 4,306 cities in India.

Managing Director- Latif Nathani.

Head Office- Goregaon East, Mumbai.

Corporate Affairs

In 2004, eBay acquired 25% of classified listings website, Craigslist.

In 2005 eBay acquired Skype.

In 2007 eBay acquired StubHub.

On October 3, 2002, PayPal became a wholly owned subsidiary of eBay.

eBay and PayPal have splitted their operations into two individual companies since 20th July, 2015.

Reasons for Separation from Paypal

Competitive landscape of online payment- Square, Visa and Apple Pay.

Overnight increase in value.

Very different set of strategic priorities.

Business Model

eBay enables commerce through three reportable segments.

Marketplaces

Payments

Enterprise

Marketplace Features

eBay is a leading commerce platform for users and merchants. eBay provides a variety of access points for consumers to shop

virtually anytime, anywhere.  eBay provides a large selection of inventory globally. eBay strives to provide value to consumers. eBay offers consumers choice. eBay offers a variety of specialized vertical experiences.

Payment Features

eBay enables payments in the online and physical worlds.

Global reach and scale provides value for consumers and merchants.

eBay offers consumers choice by providing a variety of funding mechanisms.

eBay is focused on making solutions simple for customers and developers.

Payments solutions offer leading fraud prevention and protection.

Enterprise

Enterprise operates three primary lines of business:

Commerce Technologies

Omnichannel Operations Solutions

Commerce Marketing Solutions

Commerce Technologies

eBay Enterprise Retail Order Management solution

The eBay Enterprise payments infrastructure

eBay Enterprise Store Fulfilment solutions

eBay Enterprise Retail Associate Platform

Omnichannel Solutions

eBay Enterprise Fulfilment and Freight solutions

Provides scalable, market leading direct to consumer fulfilment with seven campuses across U.S., Canada and Europe

Provides scalability, operational efficiency and cost efficiencies that retailers cannot achieve on their own.

Marketing Solutions

Focused on providing comprehensive, industry-leading marketing technology solutions as well as digital agency services.

Includes a suite of demand generation capabilities including: affiliate marketing; attribution; database and CRM; email & mobile marketing; online advertising display targeting.

eBay Enterprise Agency Services offers full-service digital marketing specializing in analytics and optimization; creative services; studio services; media services; search engine marketing; user experience design and usability research.

Business models offered to sellers and customers

Yard sales

Consignment

eBay stores

Dropshipping

Wholesaling

Organisational Structure

eBay Inc

CEO

CFO CCOCommunicatio

ns Director, CMO

HR, Chief

People’s

Officer

Chief Technological Officer

Legal, Gener

al Couns

el

Chief Produc

t OfficerCateg

ory Head

Chief Strate

gy Officer

Velocity Statistics A pair of shoes sold every 2 seconds Womens accessories sold every 3 seconds Three woman's dresses sold every 2 seconds A pair of womens jeans sold every 15

seconds A pair of mens sunglasses sold every 16

seconds A mens necktie sold every 22 seconds A womens handbag sold every 5 seconds A cell phone sold every 4 seconds An MP3 Player sold every 40 seconds

including Apple iPod, Creative Zen, and others

An LCD television sold every 2.5 minutes Headphones sold every 16 seconds

An iPad sold every 15 seconds An item in the home décor category sold

every 4 seconds A bedding item sold every 16 seconds A bath item sold every 16 seconds A major appliance sold every 17 seconds A baby gear item sold every 2 minutes Three parts or accessories sold every 1

second A motorcycle part is sold every 2.3

seconds An engine or component is sold every

7.2 seconds A wheel or tire part is sold every 5.9

seconds A snowmobile, ATV, or personal

watercraft part or accessory is sold every 7.1 seconds

Functions of eBay India

Category ManagementMarketingProductLogisticsFinance

Category Management

Category management is a frame-work and set of practices used to optimally manage supply categories to meet business objectives.

A category is a grouping of materials or services that have similar supply and usage characteristics to meet business objectives.

The head office of eBay in India, located in Mumbai, is responsible for the category management of the site eBay.in.

Its main function is to decide the categories to be put on the site and the items sold in each category.

Category Management Workflow

Follow UpCategory

Tactics and Execution

Category Strategy

Company GoalsMarket Insight

Marketing

The marketing department must act as a guide and lead the company's other departments in developing, producing, fulfilling, and servicing products or services for their customers.

Build relationship with the audience

Involve the customer

Generate income

Tools of Marketing Department

Marketing research

Product development

Advertising and promotional campaigning

Business development

Responsibilities of Marketing Department

Applying customer-centric approach Keeping up with the competition Branding Finding the right partners Being creative and innovative Communicating with other departments Budgeting Being aware of ROI Managing strategy Managing research Managing events

Product Team

Consumer Support

eBay Enterprise provides branded customer care services for commerce via telephone, IVR, live chat, email, and social support through three call centres and a network of customer support agents

The eBay Enterprise customer care platform combines proprietary and third-party technologies, including automatic call distribution, computer telephony integration, interactive voice response, email, workforce management, voice recording/monitoring, and customer relationship management systems.

eBay Enterprise call centre operations utilize business intelligence to optimize service, sales, agent and cost efficiencies as well as revenue enhancing services to help drive retail revenue through customer service interactions.

Finance Department

The business functions of a finance department typically include planning, organizing, auditing, accounting for and controlling its company's finances.

Role of the Finance Department

Cash Flows Accounts Receivable and Payable Taxes Investments

Competitors’ analysis

EBay is an open marketplace (OMP) — a technology-based, asset-light model. It merely hosts sellers, of new and, in a small percentage, used goods, and connects them to buyers.

EBay does not handle logistics beyond alerting its partners in this space via an automated process. When goods move from sellers to buyers, they don't pass through an eBay warehouse.

Flipkart, Amazon and Snapdeal — all follow the managed marketplace model (MMP), where they control delivery and returns, and don't do used goods. Snapdeal has opted for MMP as the question of trust comes in OMP

Contd.

On an average day, while eBay India sells 18 products a minute, Flipkart clocks 20.

eBay believes in growth along with the retail industry whereas Flipkart, Amazon and Snapdeal believe in competing with the retail industry.

Contd.

eBay India had revenues or income of Rs 107 crore calculated on commission earned from sellers along with advertising revenues for fiscal 2013-14, according to its annual filing to the Registrar of Companies.

Amazon Seller Services had revenues of Rs 169 crore and Flipkart Internet that manages the portal reported income of Rs 179 crore. A year earlier, eBay's revenue was Rs 81 crore while Flipkart trailed with Rs 15.4 crore.

eBay vs Amazon Business Model

Amazon makes a buyer feel that he is buying directly from Amazon With fulfilment By Amazon, a seller can even have his items stored and

shipped directly from Amazon’s warehouses. On the other hand, a seller might prefer to use eBay in order to customize

and personalize his listings.

SWOT AnalysisSTRENGTH OPPORTUNITY

World’s largest internet marketplace

Business model (no strong direct competition)

Economies of scale Localization Payment system Brand reputation

Growing number of mobile shoppers

Become a retailer Increase services and product

portfolio through acquisition Open more online stores in other

countries

WEAKNESS THREATS High fees No further growth strategy

Online security Regional low cost online retailers Increasing competition from

Amazon, Flipkart and Snapdeal Exchange rates

Market Research onInsights on Consumer Behaviour and

Buying Preferences for Lifestyle Products

Watches and Baby and Mom Products

Objectives

Primary Objective find the consumers’ buying pattern in the categories of wrist watch and baby and mom

products.

Secondary Objectives find the ASPs of the product categories in various retail stores. find the most preferred and most sold brands of these product categories. analyse the consumers’ buying behaviour in various stores. find out the attributes that influence the buying behaviour of the consumers.

Scope and Limitations

Scope: This research work has scope for further utilization in determining market

statistics for the company as well as for other e-commerce companies.

Limitations: People might not be always willing to respond to all of the questions.

Respondents tend to be confused in rank and rating charts. Most of the retailers are unwilling to cooperate. Time is a big limitation. Samples are limited within the state because of time and monetary constraints.

Research Design and Methodology

Design: Exploratory research that focuses on the discovery of ideas and is generally based on Primary data.

Research is based on descriptive study that helps to know the characteristics of certain group such as age, sex, education, level, income occupation etc.

Source of data : Primary data Research method: Survey research (sampling method) Research Instrument: Questionnaire Type of questionnaire: Structured

Type of question: close ended Measurement Scale: Ordinal scale Scaling: Comparative and Non comparative Types of scale: Likart scale Sample Size: (240x2 + 50x2) Sampling Frame: Population of Mumbai, Greater Mumbai and

Navi Mumbai Unit of analysis: Students, Executives, Businessmen and

women, Housewives, Parents Methodology: The sample size is 240 consumers and 50

retailers in each category of products. The report is based on only primary data.

Analysis based on consumer’s responses

Watches

Among Indian brands Titan is preferred by the majority of consumers, i.e. 45.2% whereas Fastrack is preferred by 34.4% consumers. Sonata and Timex are preferred by 9.1% and 5.4% consumers respectively

The survey shows that most consumers, i.e. 33.6% visit online stores in 1-2 years to buy watches.

Most preferred site is Flipkart with 35.7% preference followed by Ebay with 22.8% and amazon with 17.8% preference.

Bar chart represents the family members who make decision while

buying watches .

The survey shows that majority of the consumers, i.e. 29%, uses Titan brand for wrist watches followed by Fastrack with 21.2% users. In international brands Guess and Citizen are used mostly with frequency of 4.6% and 2.1% respectively

In international brands Armani and Citizen are preferred mostly by 12.9% and 11.6% consumers

For fashion wrist watches majority of the women prefer branded wrist watches, i.e. 76.3% and unbranded low priced fashion

watches are preferred by 23.7%

Analysis Based on Retailers’ Responses

Watches

According to the watch retailers, the most selling Indian brand is Titan (78%) followed by Fastrack (22%).

Among the foreign brands, the most selling one is Fossil (52%), followed by Casio (10%), Xylys (8%), Tag Heuer (8%), Esprit (6%), Guess (6%), Rado (4%), Tissot (4%) and Tommy

Hilfiger (2%).

ASP of various Brands: The ASP of Titan is Rs 5785 and most selling price is Rs

4500. The ASP of Fastrack is Rs 1920 and most selling price is Rs

2000. The ASP of Citizen is Rs 11020 and most selling price is Rs

1000. The ASP of Armani is Rs 15930 and most selling price is Rs

15000. The ASP of Giordano is Rs 5250 and most selling price is Rs

5500. The ASP of Seiko is Rs 18129.40 and most selling price is

Rs 15000. The ASP of Rado is Rs 39620 and most selling price is Rs

38000. The ASP of Michael Kors is Rs 13901 and most selling price

is Rs 15000.

Other inferences:

When the retailers were asked about the preferences of women between branded and unbranded watches, while buying fashion watches, 100% were in the favour of branded watches.

With respect to warranty offered, all the retailers surveyed informed that they offer manufacturer’s warranty.

According to the retailers, most preferred type of warranty by the customers is manufacturer’s (100%).

Analysis based on consumer’s responses

Baby and Mom Products

Flipkart leads the market with 33.3% preference followed by Amazon with 26.3% preference for baby care products.

Firstcry has a preference of 13.3% followed by Ebay with 11.3% preference for baby care products

In e-retailing the most selling is diapers with a frequency of 47.9%. The skin care products have a market of 17.1%

followed by toys with 12.1%

In brick and mortar most bought baby product is diapers with 40.4% followed by clothes with 23.8% sales. Baby food account

for 21.7% sales followed by skin care, toys and prams

In diapers most preferred brand is Pampers with 52.1% preferance followed by Huggies with 25.4% , Mamy Poko

10% followed by Libero with 6.3% and Charlie Banana with 4.6% preference

The most sold pack size in diapers is “36-60 pcs” with 37.9% preference. “18-36 pcs” pack have 29.2% preference followed

by “above 60 pcs” pack with 21.3% preference.

The most selling size of diapers is M

In prams Mee Mee is leading with 42.9% preference. Luvlap has preference of 12.1% followed by Dreambaby and

Mothercare. Other brands like Gracco have 30% preference

Most preferred price range for prams is Rs. 3000-5000 with 34.2% preference followed by 33.8% preference for Rs. 5000-

7000.

In toys development toys and activity toys are most preferred by respectively 43.3% and 16.3% consumers. Soft toys also are

preferred by 16.3% consumers.

Fisherprice is the most preferred brand of toys with 35.8% preference followed by Chicco with 24.2% preference. Funskool

and Disney follow with respectively 16.7% and 13.8% preference

Analysis Based on Retailers’ Responses

Baby and Mom Products

In the baby care product category, diaper is the most selling item (76%), followed by skin care (18%) and toys (6%).

In the preference for pack size of diapers, the most selling pack size is “18-36” (36%), followed by “36-60” (20%), “6-18”(18%),

“below 6”(16%) and “above 60”(10%).

In the preference for diaper size, the most preferred size is “M”(66%), followed by “S”(26%) and “L”(8%).

In the category of Prams, the most sold brand is “Others”(42%), followed by “MeeMee”(40%) and Mothercare,

Luvlap and Graco, each 6 %

In the Toys segment, the most preferred type is the Activity toys (48%), followed by Soft toys (24%), Automobile (6%),

Rattles (4%) and Bath toys (2%).

The most selling Toy brand is others (38%) followed by Mee Mee (26%), FisherPrice (24%), Funskool (8%) and Disney (4%)

Findings and Recommendations

The survey revealed that watch brands like Invicta are not well known amongst the Indian consumers. Hence eBay India needs to come up with better promotion strategy to make the consumers well aware of the brands and offerings eBay offers to its consumers.

Consumers are not at aware of the fact that eBay India also sells baby and mom products through its online portal. Therefore the company should aim at making its consumers aware of the categories of products sold in its site by undertaking better promotional techniques.

It is seen that eBay does not participate in any kind of promotions or festive promotions. These are the weak points that eBay needs to work on.

Contd.

o eBay India must stop following eBay Inc., US’s business model and start aiming at making profits.

o eBay can also change its logistics pattern by keeping inventory in its warehouses and control inventory supply process in order to gain control over the vendors which will prevent fraudulent activities.

o The company website has many faults including navigation defects as well as product listing problems. eBay must make the web page more professional and relevant so that consumers do not get confused.

o eBay was primarily a bidding site(C2C) where consumers could auction on products to be sold. This positioning of eBay has to be upgraded so that consumers become well aware of the fact that eBay also offers B2C and B2B selling services.

References:

https://www.ebayinc.com/our-company/our-history/ Pooja Vishant (2015)http://indianonlineseller.com/2015/05/ebay-updates-shipping-policy-for-four-categories-in-

jewellery/ Shelley Singh (2014)http://articles.economictimes.indiatimes.com/2014-09-09/news/53730647_1_ebay-india-

latif-nathani-flipkart-and-amazon Raghavendra Kamath (2014) http://www.business-standard.com/article/management/snapdeal-s-lessons-from-

ebay-114030200685_1.html http://www.theofficialboard.com/org-chart/ebay http://www.exampleessays.com/viewpaper/25348.html http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandtelecoms/digital-media/11134139/The-

five-reasons-behind-PayPals-split-from-eBay.html http://www.wikinewsindia.com/tech-news/ciol/paypal-separates-from-ebay/ http://www.strategicmanagementinsight.com/swot-analyses/ebay-swot-analysis.html http://my.studyindenmark.dk/profiles/blogs/wahid-s-initiative-what-is-the-responsibility-or-role-of-the

Ms. Prabha HariharanCategory Head

eBay IndiaGoregaon East, MumbaiContact no. 9823392433

I express my gratitude to:

THANK YOU