The two online retailer juggernauts duke it out in this E-business analysis of eBay .vs. Amazon. Dug up from coursework back in 2007...

1. eBay .vs. Amazon Analysis of two “first-movers” that lasted, in the E-commerce space Student: Bryan Copeland Student ID: 053171c Submitted to: Wakayama-sensei

2. eBay

4. History 15.13 Acquired PayPal Jul 2002 12.708 Global expansion to over 2 dozen countries 2000-2006 49.500 Acquired Skype 2005 20.833 Withdrew from Japanese market & Hong Kong (where Yahoo! Auctions/Shopping had head start) Feb 2002 1.871 CEO Meg Whitman (July); IPO 1998 25.016 Alliance with AOL 1999 Founded by Pierre Omidyar 1995 Menl Park, Calif (VC) 22% stock acquisition 1997 Stock ($) Event Date

8. Business Process Seller Account Creation Listing an Item Reserve Dutch Buy-it Now Regular (Auction Type) Bids Placed Completing a Sale After-sales Service Typically covered by Seller, using eBay’s features. No bids Final Value Fee = 5% of the first $25 + 2.5% of remaining amount up to $1,000 + 1.25% of any portion of sale over $1,000 -eBay sends Outbid Notice if needed. -Seller’s feedback rating dictates bidder confidence.

10. eBay’s Business Model Seller Buyer Internet property sales format Network externality social communication Mediation (forums, buyer/seller ratings) U niversality Regional sites Information asymmetry Trust and safety Virtual capacity large variety Low cost Innovative (Bid-based auctioning systems) Exchange Transaction Community platform For global person to person trade More Profit Decreased Costs Win-win situation Leads Repeat Transaction

13. Internet Properties / / / / / Transaction-Cost Reducer / / Creative Destroyer / / / / Low Cost Standard / / Infinite Virtual Capacity / / / Info. Asymmetry Shrinker / / / / Time Moderator / / / Distribution Channel / / Network Externality / / / / / Universality / / / / / Mediation Communication Content Community Commerce Coordination

16. Amazon

18. History 1 - http://www.wired.com/wired/archive/7.03/change.html 54.135 Acquired IMDB, world’s biggest movie database Dec 21, 1998 Founded then Launched by Jeff Bezos 1994-1995 49.500 Video sales launched Nov 17, 1998 67.85 (mean) Global growth in key international markets 1999-2003 12.708 Amazon.com Kids launched Mar 2, 1998 72.29 (6-6-07) Merchant strategy; major corporate partners 2003-2007 20.833 Music sales launched Jun 11, 1998 9.896 Millionth customer personally receives order from Bezos's hands Oct 28, 1997 8.833 First holiday-gift center opened Nov 18, 1997 3.917 IPO May 15, 1997 9.250 Collaborative Filter recommendations launched Sep 23, 1997 Stock ($) Event Date

19. Industry Competitors: Intensity of Rivalry Supplier s Buyers New Entrants Substitutes Threat of New Entrants Bargaining Power of Buyers Threat of Substitutes Bargaining Power of Suppliers Network Externality – ( no customer base ) Low Cost Standard + Universality + Distribution Channel + Transaction Cost Reducer + Mediation – ( no social platform ) Network Externality + ( many customers ) Mediation + ( reviews/community platform ) Distribution Channel - (replacement) Info Asymmetry Shrinker + Low cost + Transaction Cost Reducer – ( wholesale/retail ) Universality – ( regional focus ) Distribution Channel + Distribution Channel – ( No control over channel ) Info Asymmetry Shrinker + ( reduces asymmetry, so no manipulation over data ) Universality + ( existing suppliers ) Network Externality + ( large customer base ) Mediation +, – ( no social platform for sellers; great platform for buyers ) Universality – Online Retail Industry analysis

20. Evolution: From Retailer to Retail Platform

21. Sales Format B S -Communication (Reviews) -Low Cost -Large Variety -Distribution -Trust & Safety (seller ratings) Sales Format Transaction Product from Catalogue User choice Locate Sellers Store 1 Store 2 Store n “ Merchant” Storefronts

25. Value Configuration Diagram : _________ Strong CRM ‘ 1-Click Shopping’ Convenience Low Costs Diversification Partnering Network Externality Brand Image Product Review Information Customer Base Fixed Merchants Product Recommendations Cross-selling Distributed Web Services Money-back Guarantee Email Marketing Loyalty & Advocacy Merchant Advantage : Automatic Re-Ordering, etc Associates Program Association Repeat Purchases Positioning: Online Shopping Order Fulfillment (Buyer) (Seller)

27. Internet Properties / / / / / Transaction-Cost Reducer / / / Creative Destroyer / / / / Low Cost Standard / / / / Infinite Virtual Capacity / / / / Info. Asymmetry Shrinker / / / / Time Moderator / / / Distribution Channel / / / Network Externality / / / / / Universality / / / / / Mediation Communication Content Community Commerce Coordination