EBAY – CASE STUDY

STRATEGIC MANAGEMENT

SUBMITTED BY:
Aarohi Mehra
Anisha Suri
Debayan Mallik
Guneet Kaur
Neha Bhardwaj
Priyanka Chauhan
Tanu Shree
PROPOSED VISION STATEMENT

To be the world’s first choice when it comes

to trading goods.
 MISSION STATEMENT EVALUATION MATRIX

Mission Elements Presence Reason

Technology Yes Technologically advanced.

Products and Services No

Employees Yes Bright and talented employees who are dedicated to serve
their customers and communities
Customers Yes Available to individuals, business, and government.

Self-Concept Yes Always striving to stay ahead of competition

Philosophy No

Public Image Yes Reliable and secure trading platform.

Survival, Growth and Profit Yes Most profitable trading post

Markets Yes World’s most utilized trading platform

 PROPOSED MISSION

eBay’s mission is to be the world’s most utilized and most

profitable trading post. Through its bright and talented
employees, who are dedicated to serving their customers
and communities, eBay will provide the most technologically
advanced, reliable, and secure trading platform available to
individuals, businesses, and governments, while always
striving to stay ahead of our competition by offering
customers the very best service and experience.
 INTERNAL FACTOR EVALUATION (IFE) MATRIX
KEY INTERNAL FACTORS WEIGHT RATING WT. SCR

STRENGTHS      
(S1) Brand Recognition 0.075 4 0.3
(S2) Strong Customer Support and Service 0.1 4 0.4
(S3) Diverse User Base 0.05 3 0.15
(S4) Product diversity 0.05 3 0.15
(S5) Good Public Image 0.1 4 0.4
(S6) Structured Policy for Revenue Generation 0.1 4 0.4
(S7) Zero Inventory 0.1 4 0.4
(S8) Strong operating system and Organisation
Structure 0.075 4 0.3
(S9) International Presence 0.05 3 0.15
(S10) Does not fall under tax jurisdiction 0.075 4 0.3
(S11) Improvement in know how due to Acquisitions 0.05 3 0.15
(S12) Financially sound 0.05 3 0.15
 INTERNAL FACTOR EVALUATION (IFE) MATRIX
RATIN WT.
KEY INTERNAL FACTORS WEIGHT
G SCR
WEAKNESS
(W1) Weak marketing and promotional activities 0.05 2 0.1
(W2) Dependence on third party service providers
0.075 1 0.075
Total 1 3.425

A weighted score of 3.425 indicates eBay’s above average internal strength.

 EXTERNAL FACTOR EVALUATION (EFE) MATRIX

KEY EXTERNAL FACTORS WEIGHT RATING WT. SCORE

OPPORTUNITIES    
(O1) Growth in E-Commerce 0.1 4 0.4
(O2) Foray into B2B 0.075 3 0.225
(O3) Fixed Price Trading
0.075 3 0.225
(O4) Increase in service portfolio through acquisitions 0.05 3 0.15
(O5) Offering Secure Payment Options 0.05 3 0.15
(O6) International Expansion 0.075 3 0.225
(O7) Selling ad space on site to earn revenues 0.1 3 0.3
 EXTERNAL FACTOR EVALUATION (EFE) MATRIX
KEY EXTERNAL FACTORS WEIGHT RATING WT. SCORE
THREATS
(T1) Economic Conditions 0.1 2 0.2
(T2) Possible litigation costs and government regulations 0.1 2 0.2
(T3) Possible future sales tax for online businesses 0.1 3 0.3
(T4) Unanticipated downtime 0.075 3 0.225
(T5) Increasing competition from merchandise stores and e-tailers
0.1 3 0.3
TOTAL 1 2.9

A weighted score of 2.9 indicates eBay’s above average external strength.

 COMPETITIVE PROFILE MATRIX (CPM) MATRIX

eBay Yahoo! Shopping

CRITICAL SUCCESS
WEIGHTAGE
FACTORS WT. WT.
RATING RATING
SCORE SCORE

BRAND RECOGNITION 0.15 4 0.6 2 0.3

MARKET SHARE 0.2 4 0.8 2 0.4

USER UI AND CONVENIENCE 0.1 4 0.4 2 0.2

CUSTOMER SERVICE 0.2 4 0.8 2 0.4

CONTROL OVER INVENTORY 0.1 1 0.1 3 0.3

RELIABILTY OF PAYMENTS
0.15 3 0.45 3 0.45
AND DELIVERY

COMMUNITY COHESION 0.1 4 0.4 3 0.3

TOTAL 1   3.55   2.35

 IE MATRIX IFE SCORE: 3.425
GROW & BUILD EFE SCORE: 2.9

THE IFE TOTAL WEIGHTED SCORES

4 3 2 1

i ii iii
THE EFE TOTAL WEIGHTED SCORES

3
100%
iv v vi

vii viii ix

1
 SWOT MATRIX
STRENGTH WEAKNESS

(S1) + (O1) + (O5) Foraying into mobile websites (W1) + (O1) Strengthen the marketing and
and online payment systems to be able to tap promotional activities in order to tap the growth in
the upcoming internet user market e-commerce

(W2) + (O4) Dependence on third party service

(S3) + (O4)+(O2) Using their diverse user base providers can be avoided by acquiring smaller
 OPPORTUNITY

and product diversity, they should tap B2B market ventures who can perform the same job for eBay.
This will increase accountability.

(S3) +(S6)+(O7) Can generate revenue through

selling ad space and at the same time privileged
users get ad free access

(S12)+(O6) Use financial resources to perform

extensive market research in order to enter into
international markets
 SWOT MATRIX

STRENGTH WEAKNESS

(S6) + (T2) +(T3) Counter increase in cost due to

(W1) + (T5) Increase marketing and promotional
litigation, etc. by following a structured policy efforts to counter competition
for revenue generation
THREATS

(S8)+(S12)+(T4) Invest resources into (W2) + (T4) Create in-house team to reduce
strengthening the technological know-how to dependence on third party service providers thus
over come any glitches in the operating system overcoming possibilities of glitches

(S11)+(T5) Strengthen knowledge about

customer base by using the knowledge from
your acquired organization
 SPACE MATRIX
Rating
Financial Strength Ratings Environmental Stability
s
1 Gross profit percentage 5 1 Competition -3

2 % increase in income 6 2 Barriers to entry -4

3 Liquidity 5 3 Demand Variability -3

4 Return on Investment 4 Technological

4 -5
advancement
  FS Total 20
5 Economic Conditions -3
  AVG 5
  ES Total -18

  AVG -3.6
 SPACE MATRIX
Competitive Advantage Ratings Industry Strength Ratings
1 Market Share -2 1 Growth Potential 4
2 Global Presence -2 Technological
2 5
3 Brand Recognition -2 Innovation

4 Technological Innovation -3 3 Profit Potential 4

5 Customer Service -2 4 Competition 4
6 UI and Convenience -2 5 User Base 5
Reliability of Payments and
 7 -3   IS Total 22
Delivery
 8 Community Cohesion -2   AVG 4.4

CS Total -16
AVG -2.28
 SPACE MATRIX

FS+ES 1.4

CA+IS 2.12
 GRAND STRATEGY MATRIX
•Offering secure
RAPID MARKET GROWTH payment platforms

•Market
Quadrant II Quadrant I Development
(Weak competitive position working in (Strong competitive position working
rapid growth market) in rapid growth market)

WEAK COMPETITIVE STRONG COMPETITIVE

POSITION POSITION

Quadrant III Quadrant IV

(Weak competitive position working in (Strong competitive position working in
slow growth market) slow growth market)

SLOW MARKET GROWTH

 QUANTITATIVE STRATEGIC PLANNING MATRIX
Key External Factors Strategic Alternatives
Credible Online Market
Weight
Opportunities Payment System Development
AS TAS AS TAS
(O1) Growth in E-Commerce 0.1 4 0.4 4 0.4
(O2) Foray into B2B 0.075 - 0.225 4 0.3
(O3) Fixed Price Trading 0.075 - 0.225 4 0.3
(O4) Increase in service portfolio through acquisitions 0.05 4 0.15 3 0.15
(O5) Offering Secure Payment Options 0.05 4 0.2 4 0.2
(O6) International Expansion 0.075 4 0.3 4 0.3
Threats 0
(T1) Economic Conditions 0.1 - 0.2 4 0.4
(T2) Possible litigation costs and government regulations 0.1 - 0.4 4 0.4
(T3) Possible future sales tax for online businesses 0.1 2 0.2 3 0.3
(T4) Unanticipated downtime 0.075 4 0.3 3 0.225
(T5) Increasing competition from merchandise stores and e- 4 4
tailers 0.1 0.4 0.4
Total 1
 QUANTITATIVE STRATEGIC PLANNING MATRIX

Key Internal Factors Strategic Alternatives

Forward Market
Weight
Strengths integration Development
AS TAS AS TAS

(S2) Strong Customer Support and Service 0.1 4 0.4 4 0.4

(S3) Diverse User Base 0.05 3 0.15 4 0.2
(S4) Product diversity 0.05 - 0.15 4 0.2
(S5) Good Public Image 0.1 4 0.4 4 0.4
(S8) Strong operating system and Organisation Structure 0.075 4 0.3 4 0.3
(S10) Does not fall under tax jurisdiction 0.075 - 0.075 3 0.225
(S11) Improvement in know how due to Acquisitions 0.05 3 0.15 4 0.2
(S12) Financially sound 0.05 - 0.2 4 0.2
Weaknesses 0 0
(W1) Marketing and promotional activities 0.05 3 0.2 4 0.2
(W2) Dependence on third party service providers 0.075 3 0.225 4 0.3
Total 1 6.15 7.2
THANK YOU!