Robert J. Blair
Why does eBay have Problems in its Asian Markets?
In 2004 Internet Auction, eBay's Korean subsidiary was the dominant player in South Korea. Internet Auction accounted for 75% of eBay's Asian revenues. By 2006 Korean upstart Gmarket, which is 10%-owned by arch-nemesis Yahoo! had already edged past Internet Auction logging 17.2 million unique visitors, compared to 17.1 million for the eBay unit, according to Metrix. (Ihlwan, 2006)
In 2006 the chief executive of eBay's Chinese unit, Eachnet, resigned abruptly after eBay lost its top position in China's online-auction market, according to analysts and some market research. eBay then ranked second to closely held Alibaba.com's TaoBao unit which Yahoo! has a 40% stake in. TaoBao had 67% of the Chinese auction market, compared with eBay Eachnet's 29%, according to China Internet Network Information Centre, a quasigovernmental agency. (Mangalindan, 2006)
Why did E-Bay have problems in its Asian Markets? There are five main marketing reasons; Timing, Entry method, Product, Promotion, and Price.
EBay aggressively entered Asian markets in the early years of the decade because it was late behind rival Yahoo! in exploiting the lucrative Japanese online-auction market, which eBay left in 2002. (Mangalindan, 2006) This early entry into the market allowed eBay to be the first of its competitors and helped eBay's Korean subsidiary, Internet Auction, become the dominant player in South Korea. Internet Auction accounted for 75% of eBay's Asian revenues. (Ihlwan, 2006) eBay then became complacent with its dominance in the market and its product. The Global approach of offering the same product to multiple nations worked fine when there was no competition. In the mean time eBay’s competition was paying attention to what was going on and to what the customers and vendors were saying.... [continues]
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