eBay business failing in China- JV with TOM online for political connections and local knowledge
Dotcom bubble boom and then burst- Failure due to unrealistic expectations from internet companies, many
companies lacked experience of decision making. Led by engineers and not business people.
Eg– Offered free services and made revenues by advertising- Not necessary at that time
Mushrooming of online companies- Led to competition
Lack of product differentiation- No differentiation from brick-and-mortar or online companies– Such
companies ended up trying to reduce margins for survival
Other reasons- Customers not as enthusiastic as managers, misuse of funds by managers etc., missed
transactions due to web server issues, poor webpage design, technical failures
eBay was a role model of success- Meg Whitman Harvard MBA helped expansion
Started small and became big- Evolved from a trading place for collectibles to trading place for everything
Expanded globally by:
• Building new user communities solely through internal efforts by launching regional sites
in the US or localized, global sites, all of which were managed by local management
teams and supported by grassroots and online marketing programs
• Acquisitions
• Alliances
• Joint ventures
18% revenues in 2001 from international operations but had to retreat from Japan due to Yahoo (entered 5
