Ebay Problems in Asian Markets Essay

This writing ordain identify some of the reasons why E-Bay has problems in the Asian Markets as an cyberspace auction provider. After examining articles from Philip Kotler and David Gertner as well as Moon Ihlwan among others, this paper will provide my answers about why did EBay want to lucubrate glob every last(predicate)y as well as why any of these Asian earths valued their subscriber line?It will explain some research explored about what types of insertion decisions the company enjoyment in the Asian Markets. Utilizing the know takege gained about the biography of global none. Answering the question about the problems that EBay has in the Asian mart will allow me to discuss and apply concepts of the global grocery knowing in module one in support of my answers. Lastly this agreement will assess how EBays Marketing Mix assessment of the quaternary Ps assisted them in the global merchandising dodge the company adopted for the Asian Markets? Why did EBay want to ex pand globally and why did nations wanted their condescension enterprise?The reasons EBay decided to expand globally were versatile and resulted in an overall loss for the San Diego, CA establish company headed by the former CEO at the era and California Gubernatorial plunderdidate, one thousand thousand Whitman. Some of the decisions made and acted upon by the companys leadership were resembling to the way Meg Whitman ran her political campaign. Instead of researching the culture and traditions of the places they chose to do business and working on an image of being local anesthetic or at least embracing local cultures and traditions they chose to feed issues with money.In Whitmans elusion borrow millions of dollars from herself to try to resolve the issue of losing as a sufferdidate. acquire back on subject, the countries that eBay chose to expand globally in, were like all nations ones that compulsory jobs. EBay sought the cheaper labor wages as a win-win situation for themselves or some instances the prediction of a high level of success due to their business reputation. Getting into the trade was non difficult as the revolutionary market fell in line with what these countries wanted in say to develop their economies while in turn enhancing municipal quality of emotional state for their citizens.EBay felt compelled to expand globally to remain competitive as the US domestic market sh ar was becoming mature resulting in stagnant gains and overall growth. As all companies looking to globally expand eBay was investing in Asia to increase earnings by gaining a corroboratory entry into this new market fortune however there was no need to create a new market. The majority of the countries they chose had local internet auction diligence established already.EBays ultimate goals were to introduce their cleared auction business model at an international scale starting time in places like Japan, mainland China and southbound Korea to take adv antage of these nations emerging economies in order to increase wealth. Entry Decisions by the struggles in gaining entry into these emerging market areas, EBay learned that they must conform as well as embrace some of the new technologies and fruits offered by their competitors in the Asian domesticmarkets in order to be successful or at least competitive in the market.The beating they took in Asia was not justfrom Chinese and South Korean competition, but from 2 US based competitors in rube and Google. A currentdomestic alliance with Yahoo against the giant Google has not resulted in any increase in positive business in theglobal market share as Yahoo is go on to gain more shares of the market through its ventures with localcompetitors. EBay market entry decisions were integral to their failure in Asia.As ascertained from a case studypublished May 2008 about EBays Strategy in Japan 1, they draw ined the Japanese market late afterwards Yahoo Japan had already established a nd failed to retain guests. It took them two eld to concede the failure of the EBay Japan and instead of making a merchandise with local investors they finally folded in 2002. Ironically, in 2007 EBay made a chaw with Yahoo Japan to share internet sites and products in Japan in a critical point web site called Sekaimon 1.Their failures in Asia has eventually led to layoff of workers in countries like Taiwan and shutting d declare of several sites in Asia while rerouting customers to US based sites to maintain a virtual presence. In 2006 EBays South Korean venture meshing Auction was bested by a South Korean competitor named Gmarket whereas they equaled or eclipsed EBays profit share in South Korea that year. Gmarket also produced innovating products to the internet auction manufacturing such as making shopping via internet fun and employ tie-in promotions.Excerpts taken from a Moon Ilhwan internet article in Business Week2, further explain the stiff competition EBay had in S outh Korea from Yahoo and the local young, Gmarkets business model places less fierceness on an open auction format than eBays. The company offers goods that one can order at fixed prices, with an option to negotiate prices with a marketer on an exclusive basis. This allows buyers to conclude deals instantly instead of requiring them to wait until all bids are completed in open auctions and another tie in marketing program is a lottery called lucky auction.It gives buyers chances to buy everything from liquid crystal display televisions to T-shirts at a fraction of the market value. A seller promoting an MP3 player, for example, invites consumers to bid for two of them within a given price range unremarkably less than 10% of the retail price. Then Gmarkets computer picks two bids at random to decide the winners. Others visitors can buy the MP3 player at a special offer price. The seller attracts consumers, while Gmarket happily hauls in commissions.Another incentive at Gmarket i s that retailers can offer online links to their own mini homepages within the site, issue discount coupons, run joint gas mileage points programs, and use an internal messenger service called G-messenger for instant chatting with sellers. Some shops listed on the site have also drawn traffic by vivid to donate 10 cents to a favored charity every time a product is sold 2Thus far EBay has try joint ventures and mergers to enter the Asian market share and has met negative results.This has had a negative assemble on their overall performance to expense ratio in their computer memory valuation from 2000 thru the present time but has not deterred management from continuing to compete for a market share in Asia. An ongoing joint venture with Yahoo keeps EBay with a foot in the door of the alien market and continues the strategic alliance against Google. EBay has expanded to atomic number 34 Asia to see what they can obtain in Singapore, Malaysia and through operations in the Philipp ines. Currently they are doing promotional sites in Thailand and Vietnam to gauge future profits in those nations as well.EBays use of the Four Ps in their marketing mix assessmentEBays use of the Four Ps in their assessment of their global market strategy was regretful in Asia when in comparison to Yahoos success. Lost on the EBay leadership was the inclination to be a part of the local market and understanding cultural diversity of each Asian nation they wanted to establish a market. From my personal experiences going to countries such as Japan, South Korea, Guam, or the Philippines for business this is merry to earning shares of the Asian market and as a personal future as well.Yahoos co-founder, Yang is a male businessman of Chinese-Taiwanese kin which had to give Yahoo an edge in Japan, China and South Korea over EBays CEO at the time Meg Whitman who was female, Caucasian rail line and unaware culturally of how to gain the confidence of local leaders and business persons. 3The product that EBay had to offer was nothing innovative to the Asian market as there was already a local variant of online auctions/internet industry thriving in Japan, China and South Korea.Timing and placement of EBays business model was late and over reaching as Yahoo already was established in each of the locations chosen and early profits resulted in a false analysis of future outcomes for EBay in Asia. Promotions used on the global EBay sites had advertising geared globally instead of topically which went ignored by local customers. More emphasis toward local advertising of domestic interests could have attracted and retained their customer base.Lastly, pricing of their product which was part of the business model was somewhat excessive and confusing. So when an upstart company like Gmarket introduces something simple like, fixed prices and special deals the customers internet shopping experience just became more simplified to use and less time to use resulting in a more delectable overall product than EBay was offering at the time. The EBay pricing system had customers waiting out the end of a bidding deal which still did not guarantee the customer the outcome desired if they were outbid.EBays managements inflexibility hindered the local managements energy to make decisions that would help them get more of the local market share and build from there in their own country and marketplace. 3 reciprocation EBays ventures in expanding to a global market were incurred several superable challenges. As stated in the lesson the Asian market share is vital and profitable for many companies. As the research depicted one of EBays primary challenges was completion at several levels global and local/domestic competitors all vying for a market share of the internet auction industry.EBay attempted to manage market entry problems long after their original business model was viable in the region, by adapting lowering or waiving fees for its go to keep up with t he competition from Yahoo, Google, Chinese stall worth Internet Auction and South Korean upstart GMarket. EBay failed to incorporate some of the local technical innovations that likes of GMarket produced for its customer base such as, local advertising on the sites, fixed price so that internet shoppers could get what they were shopping for and not have to outbid others and wait for the outcome of who actually won/bought the products advertised. storey was another problem for EBay, they did not study the culture and traditions of the places they chose to enter the market at. Cultural traditions and business practices are conversely different in China which operates under quasi-governmental entities, and Japan and South Korea where they operate under version of the allay Market concept. Along with not understanding Asian cultures the company did not attempt to adapt its global business model to the local market when incorporating its management and leadership philosophies to the reg ion.This resulted in a management and leadership lag overseas that would not be capable of maturing as a team up to meet the local demands of the market. Just being in the region did not give EBay the advantage they seemed it would, thus their own inflexibility and lack of foresightedness contributed greatly to the problems they are facing in the Asian market. To EBays recognize they have not thrown in the towel and have remained in Asia through joint ventures and are actually conducting promotion in Southeast Asia (Thailand and Vietnam) as well operations in Singapore, the Philippines and other places.