eBay - Staying Online - Always

Background Note Contd...

Customers could use the relevant links to get information regarding how to use the site. They were also informed about the tools that eBay had to ensure the site's safety. A bidder could see the listing of the total items to be auctioned by clicking categories or specific sub-categories. A 'shop by photos in the gallery' facility allowed a bidder to see the photograph of the items along with the description. Users who wanted to trade in the local region could specify region in the text box (pick a region) and could begin trading by choosing a suitable category (automobile, appliances). A seller could get information regarding activities like registration, how to enter the credit card number and how to photograph an item. Clicking the 'sell' button, a seller could also visit the page where he could list the item for sale.

In addition to a search facility on its home page, eBay provided a 'search' link on the main navigation bar to enable visitors to search items in six ways; listing title by search, item number, seller search, bidder search, completed auction and regional search. Search facilities also provided the option to narrow down the number of items to be listed after the search.

For instance, while searching items through 'listing title search,' one could specify the price range and country where the item was available and could sort the listing based on the last date of auctions. eBay also sent electronic invoices to all sellers via e-mail on a monthly basis. The accounts of the sellers, who opted for credit card payment mechanism, were billed directly.

At regular intervals, eBay updated a text-based search engine with the titles and descriptions of new items, as well as the pricing and bidding updates for active items. The company also supported a number of community bulletin boards and chat areas where its customer support personnel could interact. By 2001, eBay had emerged as the largest person to person auctioneer in the world with a registered user base of 42.4 million.

For the financial year ended December 31, 2001, the company generated $748.82 million revenue and $90.45 million (see Exhibit II) net profit. eBay was ranked as the #1⁴ online shopping destination, with nearly 5 million unique daily visitors during the peak shopping season in December. For the quarter ended December 31, 2001, eBay hosted over 126.5 million items. The company's users transacted a record $2.735 billion in gross merchandise sales during the same period. Though the company had been performing well financially, the frequent outages had attracted severe criticism.

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4] According to an IT research firm, Jupiter Media Matrix.

Case Details

Case Code : ITSY015
Themes: Internet Companies
Case Length : 08 Pages
Period : 1995-2001
Organization : eBay
Pub Date : 2002
Teaching Note : Available
Countries : USA
Industry : Information Technology

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