a) Who are eBay’s customers for its auction business and to what extent do they constitute an attractive target market? b) What forms of differentiation does eBay use with those customers and how appropriate is this positioning to the segment it is targeting c) Evaluate;
• the match between eBay’s resources and its positioning and • whether its differentiation is sustainable
Marketing theorists believe that in order for a business to be successful they should be market driven, that they should define their target market and customers and then design the products or services offered to satisfy those needs, (Haberberg & Rieple, 2008). Targeting a market involves further subdividing and breaking the market into segments, “buyers who are linked by some common characteristics”, (Haberberg & Rieple, 2008, pg 19) and then concentrate your efforts onto a few key segments. Segments can be defined as a “group of individuals, for business to consumers (B2C) markets, or groups of organisations in business to business (B2B) markets”, (Haberberg & Rieple, 2008, pg 158). Typically an organisation would target one or the other segment however in the case of E-Bay it operates for both B2C and B2B, it boosts being a global trading platform where practically anyone can trade anything. The auction website is not only a platform for selling used goods for individuals and small firms, it has also attracted the attention of large multinational companies who view E-Bay as an alternative distribution channel where they can sell excess and unwanted stock. The online auction site however is not only a site for business purposes it is also a place where individuals can sell one off items to one another with no business purposes, so it also operates for consumer to consumer (C2C) trading. E-Bay are mainstream in their target customers in the sense that primarily they reach out to the average individual, the average America, the average German, the average British, and geographically its largest source of revenue derives from the USA, however Germany, South Korea and the UK have been identified as important sources. To ensure that its geographic base continues to grow it has 27 websites, each tailored to suit the individual country. E-Bay is evolving rapidly and that is mainly because their choice of market segmentation has been effective and contributes to its continued success, below is the characteristics that make E-Bays market segmentation effective. |Broad and Homogenous |Consumers can shop for never ending lists of products at the best| | |price possible with a secure reliable service. | |Easily Accessible |E-Bay is a global trading platform and customers and traders can | | |be easily accessible at the click of a button. | |Affluent |Roots of E-Bay are the rare collectable items that can be found | | |on the website. | |Not Price Sensitive |There are high margins of profit made from the fact that E-Bay | | |not only sells quality value for money used goods but also rare | | |collectable items. | |Potentially Brand Loyal |E-Bay is a forum that provides and efficient market for buyers | | |and sellers to connect with an efficient distribution system, | |...
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