Strategic Issues and Recommendations Ebay

First of all, eBay has to deal with more and more competitors in the e-commerce market. For instance, both Alibaba and Walmart said in 2009 that they were launching competitors in the US to services like eBay and Amazon. The problem is that small share gains over time (for new entrants) could potentially pinch margins at both Amazon and eBay. That is why eBay has to improve its competitive strategy. What I recommend to the company is to think about strategic collaboration with global social networks such as Facebook and Twitter in order to create more efficient and effective communication -and thus improve its brand image. The company may develop a discussion forum where customers can communicate the different products they would like to buy : other users can add comments and suggest companies and products options for that product. eBay could also suggest other current items that the customer may buy in that category (Amazon uses this system : you can see what customers bought in addition to the first item). This recommendation is the most crucial one since it will give them a direct advantage over competitors which have not thought about it yet.

The second strategic issue eBay has to deal with is the increasing dissatisfaction from its customers. According to the 2012 ACIS (American Customer Satisfaction Index), even though the eBay score is 81, eBay is the only e-retail company measured by the ACSI to have lower satisfaction now than it did when it was measured twelve years ago. Moreover, there have been more and more complaints from eBay customers concerning frauds, non-respected time deliveries or even problems within the eBay community (no trust between the buyer and the vendor). Consequently, not only consumers are taking their business elsewhere, but so are retailers. In this context, what I recommend to eBay is to strengthen the brand image, preserve the vitality of the eBay community, but, above all, eBay must foster its community affinity and improve