Company Profile
eBay is an international company incorporated on 13 March 1998. It operates on Stub Hub, the marketplace, and classifieds platforms. The firm allows sellers to offer commodities to buyers in an online platform. According to “eBay Inc,” the platforms are accessible through online, mobile devices, and other application programming interfaces. The marketplace for eBay is located on its website, www.ebay.com, its mobile applications, and among localized counterparts.
Company History
eBay was founded in 1995 by Pierre Omidyar in San Jose California, as an auction-based company, “Auction web.” eBay allowed individuals to sell their goods and services. From the conception of the company, Pierre worked with Jeff Skoll, a business partner and later introduced Meg Whitman to sustain the company’s success (“Our history”).
The first sale was made in 1995 to Mark Fraser, a Canadian, who bought a broken laser pointer. In 1996, the company hired its first employee, Chris Agarpao, to coordinate online operations for virtual shopping. In the same year, Pierre introduced a feedback system to ensure that buyers and sellers accessed a fair trade through community information. This system remains one of the most successful features on eBay. eBay made more than 7.2 million dollar sales in the first two years (“Our history”). Jeff Skroll became the company’s president in 1996.
Growth and Development of the Company
eBay made its one-millionth sale two years later, after selling a jack-in-the-box bird. In 1997, the company’s name was changed from Auction Web to eBay. Subsequently, the company went public in 1998 and sold more than $53 shares in a single day. In 2000, the company started eBay University, which focused on assisting upcoming sellers in identifying their grip in the marketplace globally. In the same year, the company established other subsidiary companies, such as Half.com, and introduced an option to buy items immediately through a “buy it now” choice on their website. In 2001, the company introduced stores that gave sellers an option to open personal dedicated eBay shops to rival other upcoming online e-commerce enterprises. In 2006, eBay made a wide development by partnering with PayPal payment processing system (“History of eBay”). However, they parted ways in 2015, after eBay accused PayPal of unreliability and constant interruption of business.
CEO Information
Since 2015, Devin Wenig has been the CEO and president of eBay. He is the third CEO since the inception of the company. The purpose-driven leader has seen the company’s annual volume grow from $60.3 billion to $95 billion between 2011 and 2018. Besides, the customer base has increased by 81% (“eBay Inc”). Other achievements under his leadership include the transformation of business through data, artificial intelligence investment, differentiation of the brand, mobile experience redesign, and global expansion
Devin is a great fan of sports, an amateur coder, runner, and art enthusiast. One of his greatest passions is applying technology to impact global communities positively (“eBay Inc”). Devin receives a salary of $18,172,166 as total compensation and serves the society as a board member of different areas, including Marina Biotech, Nastech pharmaceuticals, and March of Dimes (“David. N. Wenig”).
Major Competitors
eBay has several major competitors, including Amazon.com and Alibaba.com. Some of the striking features of eBay in comparison to its competitors include:
| Business Model | Pricing | Sellers Service | |
| eBay | It operates as an auction house.
It assists sales between third party sellers and buyers. |
Wholesale pricing strategy, providing an auction or “buy it now” options. | Sellers-oriented. Invites sellers in auction participation. |
| Amazon | Direct provider of goods. | The firm offers fixed prices. | Buyers-oriented. Invites buyers to visit the site and buy its inventory. |
| Alibaba | Acts as an intermediary between sellers and buyers. | Suppliers and sellers fix prices. | Both buyer and seller oriented since they only act as middlemen. |
Some of the disadvantages of eBay as compared to its competitors are based on payment approaches. Firstly, the payment procedure and clearance tend to be complicated compared to Amazon and Alibaba. Secondly, eBay’s policies are less flexible; for instance, the company takes only specific payments, while the keywords used to order commodities are limited compared to its competitors. Thirdly, many restrictions are evident regarding the types of goods to sell compared to the competitors (“How are eBay”). For instance, eBay does not allow the selling of digital goods, such as e-books.
Several advantages over its competitors are also evident. Firstly, eBay has registered “inbuilt” buyers. Thus, sellers engage in less both advertising and promoting their products as compared to its competitors. Secondly, eBay allows auctions, which is beneficial for the sale of some commodities, especially if a seller is not able to fix a certain price. Thirdly, eBay has strict policies on buyer protection, which give buyers confidence when using the avenue (“How are eBay”).
Stock analysis
The stock analysis of eBay for six months, one year, and five years is as shown below (Kramer).
| High | Low | Average | |
| 6 Months | 38.7500 | 28.3200 | 35.7421 |
| 1 year | 46.1900 | 26.1400 | 36.0619 |
| 5 years | 23.3296 | 18.8368 | 21.0147 |
The analysis reveals that eBay stocks have been increasing for five years, although a drop of 31.98% was recorded in 2018. Some of the reasons for the decline include slowed down sales caused by powerful competitors, such as Amazon, whose revenue increased to $38 billion in 2018 (Kramer). Besides, its rivals have outperformed eBay after the company stopped working with PayPal. The shift of mindshare has also reduced the market share for eBay. In this aspect, most consumers admit that they first search commodities on Amazon before any other site (Kramer). Hence, eBay becomes an afterthought.
Conclusion
Although eBay started as a leader in the online e-commerce platform, Amazon and Alibaba have outperformed the company in many aspects. Competition from such companies has led to a decline of eBay stocks even though the company still enjoys some market share on both auction and “buy now options.”
Works Cited
“David. N. Wenig.” Bloomberg, www.bloomberg.com/profile/person/4300278. Accessed June 2019.
“Ebay inc” Reuters, 2019, www.reuters.com/finance/stocks/company-profile/EBAY.O. Accessed 9 June 2019.
“History of eBay – How they Got to Where They are Today”. Infographic Design, 2018, www.infographicdesignteam.com/blog/history-of-ebay/. Accessed June 2019.
“How Are eBay And Amazon Different?” Investopedia, www.investopedia.com/articles/investing/061215/how-are-ebay-and-amazon-different.asp. Accessed 9 June 2019.
Kramer, Michael. Invostepedia, 2018, www.investopedia.com/news/ebay-seen-dropping-8-analysts-lower-estimates/. Accessed 9 June 2019.
“Our History.” eBay, www.ebayinc.com/our-company/our-history/. Accessed 8 June 2019.
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