Ebay Final Revision

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This is a group presentation that I participated in at DeVry University. This was for a capstone class.

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Ebay Final Revision

  1. 1. HistoryandScienceofeBay<br />By<br />AlfredGutierrez Jr.<br />
  2. 2. How eBay was founded within Pierre M. Omidyar<br />
  3. 3. Omidyar’s History Accomplishments<br /><ul><li>Omidyar taught himself how to program in BASIC, in the 7th grade.
  4. 4. He graduated high school knowing how to program in PASCAL, a step up from BASIC. He was your typical high school genius.
  5. 5. Omidyar went to Tufts University in the mid-1980, where he majored in computer science and with his passion for Apple programming.</li></li></ul><li>Omidyar’s History Accomplishments<br /><ul><li>His internship landed him a job with Silicon Valley and Innovative Data Design.
  6. 6. His internship led to a full-time job where he fit in perfectly in Silicon Valley programming sub subculture.
  7. 7. Omidyar finished up his undergraduate program at the University of California-Berkeley and received a Bachelors Degree in Computer Science in 1988. </li></li></ul><li>Omidyar’s History Accomplishments<br /><ul><li>Omidyar and his partners founded a startup company called Ink Developed Corporation in 1991, but a year and half later Omidyar and his partners realized that Ink Developed was not doing as well as expected.
  8. 8. Omidyar re-launched eShop, while moving in the general direction of the internet, but not fast enough for him, so while retaining sizable equity of the company he helped found, he bought out the company along with stocks that made him a millionaire.</li></li></ul><li>Omidyar’s History Accomplishments<br /><ul><li>In 1994, Omidyar wanted to put himself in more direct contact with people around the world using the internet.
  9. 9. Omidyar decided to auction off a broken laser pointer for testing out Auction Web.
  10. 10. Auction Web soon took over Omidyar’s entire domain—www.ebay.com—short for Echo Bay.
  11. 11. With exponential growth and strong branding, eBay thrived, and led the direction of many other upstart online auction companies.
  12. 12. By the time eBay gone public, Omidyar and Skoll were billionaires; the rest is history!</li></li></ul><li>eBay headquarters in San Jose<br />PayPal headquarters in San Jose<br />Skype headquarter in Luxembourg<br />
  13. 13. How eBay Works <br />Using the internet relied on facts:<br /><ul><li> That most people are basically honest
  14. 14. eBay provides advise on scams and phony items
  15. 15. eBay provides feedback profile in online trading reputation
  16. 16. PayPal, made it safer for recipients to get their money without seeing sensitive financial details like your credit card or bank account numbers. </li></li></ul><li>How eBay Works<br />Using the internet relied on facts:<br /><ul><li>The Price Is Right - is choosing a starting price by doing your research
  17. 17. Skype – software that allows people everywhere to make unlimited voice and video communication for free
  18. 18. Shopping.com – pioneered online comparison shopping
  19. 19. Online Classifieds - Designed to help people meet, share ideas, and trade on a local level.</li></li></ul><li>How eBay Works<br />Using the internet relied on facts:<br /><ul><li>Note that bidding on your own is a big no-no, and grounds for suspension.
  20. 20. eBay offers a number of “listing upgrades”.
  21. 21. eBay also offers a research tool that teaches you how to be an affective buyer and seller.
  22. 22. By doing research on that item, you can be sure of getting a good deal.</li></li></ul><li>eBay Science and Technologies<br /><ul><li>eBay network is committed to protecting your privacy and the security of the information you provide to us.
  23. 23. Secure Sockets Layer is a network industry-standard encryption protocol that is used to transmit users' personal or credit card information securely and privately over the internet. eBay uses this technology to keep your information safe.
  24. 24. Secure Servers can be identified by the first part of the Web address. By convention, the addresses for web pages that use a secure server and SSL connection always start with https: instead of http:.
  25. 25. Web Server is a computer program that is responsible for accepting HTTP requests from clients (user agents such as web browsers), and serving them HTTP responses along with optional data contents, which usually are web pages such as HTML documents and linked objects images.</li></li></ul><li>eBay Science and Technologies<br /><ul><li>Auction software is application software that can either be deployed on a WebServer for online auctions, or as stand-alone software for commercial and/or charity live and silent auctions. This handles all aspects of conducting an auction. It also provides the ability for users to post items for sale in an auction format as well as the ability to bid on those items.</li></ul>The inside/front of a Dell Server<br />A 19’’ rack seen with multiple servers<br />
  26. 26. Sources<br /><ul><li>Cohen, A. (2002). The Perfect Store - Inside eBay. New York: Back Bay Books/Little Brown and Company.
  27. 27. Layton, J. (1998 – 2009). How eBay works. (n.d.). Retrieved June 6, 2009, How eBay works: http://computer.howstuffworks.com/ebay9.htm
  28. 28. Ebay Auction watcher. (n.d.). Retrieved June 6, 2009, from Auction watch: http://www.auctionswatch.info/
  29. 29. Computer programming. (n.d.). Retrieved June 6,2009, from eHow.com: http://.ehow.com/information_1219-computer-programming.html
  30. 30. Onyszko, T.2002, July 19). Secure C=Socket Layer. Retrieved June 6, 2009, from Window Security.com: http://www.windowsecurity.com/articles/Secure_Socket_Layer.html
  31. 31. What are Web Server? (n.d.). Retrieved June 6, 2009, form Exforsys Inc.: http://www.exforsys.com/tutorials/clients-server/what are-web-servers.html</li></li></ul><li>EconomicsSociologyLawon Ebay<br />By Joseph Jaworski<br />Stumble!, <br />
  32. 32. eBay Economics<br />eBay dramatically changed how people see and buy goods<br />Anyone on the network can buy or sell to anyone else with minimal barriers to entry or exit<br />
  33. 33. eBay Economics<br />eBay participants now critical mass of consumers located on different continents<br />Simply a click of your mouse, and the product can be yours along with a feeling of excitement that comes from “winning”<br />eBay’s business model has made them one of the few profitable consumer-oriented auction web sites with gross margins ~80%<br />
  34. 34. eBay Economics<br />eBay’s founder, Omidyar, believed that financial markets were suppose to be free and open, but everywhere he looked he saw well-connected insiders <br />eBay’s vision was to solve this problem by creating something that had never existed outside the realm of an economic textbook: a perfect market! Also known as Perfect Competition:<br />
  35. 35. eBay EconomicsPerfect Competition:<br />Buyers and sellers are too numerous and too small to have any degree of individual control over prices<br />All buyers and sellers seek to maximize their profit<br />Buyers and sellers can freely enter or leave the market<br />All buyers and sellers have access to information regarding availability, prices, and quality of goods being traded<br />All goods of a particular nature are homogeneous, hence substitutable for one another.<br />Substitute<br />Example<br />
  36. 36. eBay EconomicsPerfect Competition Demand Curve<br />The perfect competitor faces a graphically horizontal demand curve, perfectly elastic; meaning price sensitive to demand<br />What determines market price? <br />Supply and Demand<br />When supply and demand cross on the supply/demand curve, market price is determined<br />Market Price<br />
  37. 37. eBay EconomicseBay’s Attempt Perfect Competition<br />In the eBay perfect competition scenario, a firm can sell as much as it wants to sell, at the market price<br />What if the seller raises the price? Seller gets killed by the competition offering the market priced substitute product<br />Can the seller lower the price? Seller can, but the seller can sell as much as he or she wants at the market price. However, money would be left on the table<br />eBay pure auction<br />seller starts with no minimum starting price and allows all similar auctions to compete (supply). <br />Bidders (demand) dictate the final price (market price) when the auction ends.<br />
  38. 38. eBay EconomicsPerfect Competition or Maybe not?Creating a Monopoly Through Collectables<br />eBay did achieve perfect competition in many cases<br />Always exceptions<br />In the collectors market, eBay added more variety and quantities towards perfect competition<br /> Due to the human psychology factor, monopolies were created as well<br />How? <br />
  39. 39. eBay EconomicsPerfect Competition or Maybe not?Creating a Monopoly Through Collectables<br /> “THE MUST HAVE ONE OF A KIND ITEM”<br />How many authentic game used Lebron James shoes worn his rookie year are out there in the market? <br />
  40. 40. eBay Economics<br />eBay’s CEO is estimating total company revenues expected to reach $10 billion to $12 billion in 2011<br />Up from $8.5 billion in 2008<br />Some led by strong PayPal growth, Skype and other ecommerce formats <br />
  41. 41. eBay EconomicsShopping<br />Thanksgiving-Christmas shopping season big for online retail and auctions over the years<br />Best day- 2nd Monday in December coined by eBay as “Green Monday” (green as in cash)<br />Green Monday in 2007 all time record $881M<br />Other notable 2007 online retail & auction days:<br />"Black Friday": $430 million <br />"Cyber Monday": $610 million <br />"Green Monday": $881 million<br />
  42. 42. eBay SociologyMotives and Social Effect<br />Auction participants relieved of social awkwardness and time consuming nature of face-to-face negotiating<br />Little formal attention has been given to categorizing bidder motives and studying the social effects of bidding<br />Studies suggest that buyers may participate in auctions to be a part of the “show,” and to communally decide the value of the product<br />Sellers may use auctions to arrive at a socially determined “fair” price for a product<br />
  43. 43. eBay Sociology<br />Emotional motivations for the online auction society include: <br />Addiction to excitement <br />Competing against rivals for a good deal<br />Need for friendship and community<br />Rational reasons include: <br />Getting good bargains and paying prices lower than those at retailers<br />Paying a “fair” market-determined price, and obtaining information about prices<br />
  44. 44. eBay Law- Fraud -<br />Auction fraud involves the misrepresentation of a product advertised for sale through an internet auction site or the non-delivery of products purchased through an internet auction site<br />
  45. 45. eBay Law- Fraud -<br />The Fed’s are strongly cautioning online auction consumers against:<br />The seller posts auction as if he resides in the United States, then responds outside the United States<br />The subject requests funds to be wired directly to him/her via Western Union, Money Gram, or bank-to-bank wire transfer. <br />Sellers acting as authorized dealers or factory representatives in countries where there would be no such dealers<br />Buyers who ask for the purchase to be shipped using a certain method to avoid customs or taxes<br />Address of the card holder does not match the shipping address. <br />
  46. 46. eBay Law- Fraud -<br />Online auction customers lodged more than 275,000 fraud complaints in 2008, a 33% increase from 2007<br />Total dollar loss $264.6 million/median dollar loss of $931.00 per complaint.<br />Up from $239.1 million total losses 2007<br />
  47. 47. eBay LawCounterfeit Goods Online<br />Sources say counterfeit goods change hands through online auctions estimated at $2.8 billion per year<br />Companies stepping up their efforts to protect their brands. Firms are:<br />Hiring attorneys and private investigators<br />Buying software programs to patrol eBay and other sites for fraudulent listings<br />Some investigations have led to arrests, and many have led to lawsuits.<br />
  48. 48. eBay LawCounterfeit Goods eBay<br />eBay user agreements do not permit listing of counterfeits and unauthorized replicas<br />Violators of this rule are subject to punishments varying from listing cancellations to account suspension or seller-status demotion.<br />
  49. 49. Sources<br />Cohen, A. (2002). The Perfect Store. Ney York: Back Bay Books.<br />Comscore Measurements. (n.d.). Retrieved June 4, 2009, from comscore.com: http://www.comscore.com/Press_Events/Press_Releases/2007/12/Holiday_Retail_Green_Monday/(language)/eng-US<br />Consumer Reporting. (n.d.). Retrieved June 4, 2009, from ConsumerFraudReporting.com: http://www.consumerfraudreporting.org/internet_scam_statistics.htm<br />Ebay Announcements. (2009, March 11). Retrieved June 4, 2009, from Ebay Inc.: http://investor.ebay.com/releasedetail.cfm?ReleaseID=370291<br />FBI Crime Stat. (n.d.). Retrieved June 4, 2009, from The Internet Crime Complaint Center (IC3): http://www.ic3.gov/media/annualreports.aspx<br />Perfect Competition, Economics. (n.d.). Retrieved June 4, 2009, from Tutor2U: http://tutor2u.net/economics/content/topics/competition/competition.htm<br />
  50. 50. Ethics of ebay<br />By James Jackson<br />
  51. 51.
  52. 52. Extortion on eBay<br />Extortion exists on eBay<br />Buyers use extortion to get refunds through posting negative feedback messages<br />Demand a percentage of the purchase price to remove the negative message<br />Unethical<br />
  53. 53. Sniper Software<br />Using software to grab the final bid<br />A form of cheating<br />Gives eBay a negative image<br />Unethical<br />
  54. 54.
  55. 55. Twitter for Sale on eBay<br />Unethical to sell a personal and private page from Twitter or MySpace on eBay<br />Might as well give away personal information to anyone.<br />Desperate need of money<br />
  56. 56.
  57. 57. ebay Psychology<br />By James Jackson<br />
  58. 58. Compulsive Shoppers on eBay<br />Three types of compulsive shoppers<br />Bargain hunter<br />Image shopper<br />Collector<br />
  59. 59. Bargain Hunter<br />Always looking for sales<br />Always uses coupons<br />Purchases things not needed<br />
  60. 60. Flea Market<br />
  61. 61.
  62. 62. Image Shopper<br />Look at me, see what I have<br />High priced jewelry<br />High priced clothes<br />Expensive vehicles<br />
  63. 63. Collector<br />Collects stuff in order to fit into a collection<br />Out of control<br />Beyond ability to pay<br />
  64. 64.
  65. 65. eBay Gambling<br />Auctions are similar to gambling<br />eBay is an online auction<br />Risk of winning and losing <br />
  66. 66.
  67. 67. Sources<br />Cohen, A. (2002). The Perfect Store - Inside eBay. New York: Back Bay Books/Little Brown and Company.<br /> <br />Debra Schepp, B. S. (2004). EBay Powerseller Secrets: Insider Tips From EBay's Most Successful Sellers . New York: McGraw-Hill Professional.<br /> <br />Donaldson-Evans, C. (2006, March 30). EBay Shopping: A Hard Habit to Break. Retrieved May 20, 2009, from FOXNews.com: http://www.foxnews.com/story/ 0,2933,189365,00.html<br /> <br />Green, H. (2008). Twitter: Friends for Sale. Business Week Online , 7.<br />Sally Palaian, P. D. (2009). Spent. Center City: Hazelden.<br />

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