Making eBay work
In 2006, there were over 200 million eBayers worldwide. For around 750,000 people, eBay (thhp://www.ebay.com/) was their primary source of income. A survivor of the dot.com bust of the late 1990s, eBay represents a new business model courtesy of the internet. Whatever statistics you choose-from most expensive item sold to number of auctions in any one day-the numbers amaze. “This is a whole new way of doing business,” says Meg Whitman, the CEO and President since 1998. “We’re creating something that didn’t exist before.”
eBay’s business model
Value in eBay is created by providing a virtual worldwide market for buyers and sellers and collecting a tax on transactions as they happen. The business model of eBay relies on its customers being the organisation’s product development team, sales-and marketing force, merchandising department and the security department. It is arguably the first web 2.0 company. According to eBay managers, of key importance is listening to customers: keeping up with what they want to sell, buy and how they want to do it. If customers speak, eBay listens. Technology allows every move of every potential customer to be traced, yielding rich information. Conventional companies might spend big money on getting to know their customers and persuading them to provide feedback; for eBay such feedback is often free and offered without the need for enticement. Even so some of the company’s most effective ways of getting user input do not rely on the net and do not come free. eBay organises Voice of the Customer groups which involve flying in a new group of about 10 sellers and buyers from the country to its offices every few months to discuss the company in depth. Teleconferences are held for new features and policies, however small a change they involve. Even workshops and classes are held to teach people how to make the most of the site. Participants tend to double their selling activity on eBay after taking a class. Others run...
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