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In December 20071,
eBay Inc.2 (eBay), the world's biggest online auction company, formed an alliance
with Yahoo! Japan Corporation3 (Yahoo Japan) in a cross-border trade agreement.
This marked the return of eBay to Japan after it left the country in 2002.
The agreement enabled users of Yahoo Japan to bid for items on eBay's US site
(eBay US) while eBay users in the US could transact on Yahoo Japan's Auctions
website.
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Speaking about the alliance, the then chief executive
of eBay Meg Whitman said, "We are excited to partner with Yahoo Japan in
providing Japanese users with a localized site designed to enable them
to shop on the eBay marketplace with ease and convenience."4
eBay first entered Japan in September 2000. By then, Yahoo Japan had
become a well-established portal in the Japanese market and its online
auctions site, which had started a few months before eBay's entry into
Japan, was already successful.
eBay found it difficult to establish itself in the Japanese market. Some
of its practices like charging transaction fees and requiring the use of
credit cards5 made the going tough for it. Even after operating for two
years in the country, eBay was able to garner only a 3 percent share of
the Japanese online auctions market. It therefore decided to exit the
country in 2002.
Though eBay continued to expand in other markets in Asia, it was
scouting for an opportunity to reenter Japan. After Yahoo! closed down
its auction sites in the US and Canada and agreed to collaborate with
eBay in the US on online advertising, communication, payments, etc. in
2006, eBay decided to partner with Yahoo! in its second attempt to enter
the Japanese market.
This led to eBay considering an alliance for the Japanese market,
leading to the cross border trade agreement between the two.
The strategic alliance took off with the launch of Japanese auction site
Sekaimon.com6 on December 4, 2007.7
After some groundwork, the site started its services from March 2008. It
allowed Japanese consumers to shop for items on eBay US using their
existing Japan Yahoo IDs.
It also translated items listed on eBay into Japanese along with
assistance in shipping and customs. The site was managed and operated by
Shop Airlines8, which acted as a
mediator between the Japanese and US users.
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1] "Yahoo, "EBay Team up in Online Auctions," www.news.moneycentral.msn.com, December 4, 2007.
2] eBay Inc is a US-based Internet company founded in 1995. The site provides a platform for auctions, communications and payments. Some of its well-known brands are Ebay.com, PayPal, Skype, and Shopping.com.
3] In Yahoo! Japan Corporation, Yahoo! Inc. (Yahoo!) owned a 33 percent stake and SoftBank held a 41percent stake.
4] "Yahoo, Ebay Team up in Online Auctions," www.news.moneycentral.msn.com, December 4, 2007
5] Japan was largely a cash-based society, and the use of credit cards was limited.
6] 'Sekai' means 'the world' and 'Kaimono' means 'shopping' in Japanese.
7] Mayumi Negeshi, "EBay, Yahoo Japan to Link up
Auction Services." www.uk.reuters.com, December 4, 2007.
8] Shop Airlines is a subsidiary of netprice.com, a
Japan based company that offers online shopping services. |
