Ebay Amazon Essay

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eBay and Amazon (A) 1. Based on your reading of the chapters, particularly the most recent readings, select three concepts that you believe would be relevant in analyzing this case. Elaborate the concepts and explain why you think they are useful for this case. And, rely on those concepts in answering the following questions. Concept #1 – Porter’s Five Forces (Derron is working on this) Concept #2 – Differentiation – this is a highly competitive market considering that most items on the sites can be purchased from brick and mortar locations. The everyday person can be a seller on these sites, businesses can be run from these sites (i.e. used cars, event ticketing, etc.) Innovation plays a big roles in providing customers solutions with ease of price comparison, shipping, reviews on products, etc. Cost advantage also contributes to success in what could be considered a mature industry. The overhead for Ebay is extremely low, Amazon on the other hand could show tremendous profit if it did not reinvest in infrastructure (need to discuss this point w/ Derron, he seemed to think differently here) Concept #3 – Dynamic capabilities (Ch 8 pg 227) the e-commerce industry provides the ability to “integrate, build, and reconfigure internal and external competences to address rapidly changing environments.” The fact that Ebay and Amazon primarily do not have brick and mortar locations provide flexibility to adapt to reconfigure its resources. Ebay and Amazon were essentially brought about by the “need” concept for e-commerce across the globe. 2. What are the key drivers of profitability in eBay’s business model? We can pull most of this from the email from the ex half.com employee below. * One of the key items to profitability for ebay was transaction volume and cost, and seller investment in the ebay brand. * I forget the exact

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