United States in 2003/4, reported consumer losses due to fraud amounted to $200
million, half of which involved online auctions (The Economist, 2005)
There are measures that users of e-Bay can take to protect themselves from being
victims of fraudulent activity. These include:
Check out the seller or buyer through feedback from other users;
Do not bid too high since sellers can get agents to bid on items to artificially
raise the price;
Establish whether or not the item bid for is insured;
Find out where the trader is based;
Do not pay by money transfer services, pay by credit card or via PayPal
accounts.
PROS CONS
PRESENT Strength Weakness
First-mover advantages in Managing expansion into
online auction market; key markets such as Japan;
Global brand awareness; Communications with
Network externalities created professional traders who
by developing a community of are reliant on the e-Bay
buyers and sellers; website;
Brand loyalty of buyers and Understanding cultural
sellers because of quality of differences in foreign
service; markets.
Economies of scale from huge
customer base;
Profitable from first month of
trading;
Acquisition of specialist firms
to create synergy and provide
value-adding and
differentiated services;
Conservative management
style.
FUTURE Oportunities Threats
Expanding services; Security breaches and
Expanding internationally, fraud;
especially in the growth Intensity of competition;
markets of China and India; Pressure to meet
Forming alliances with other expectations of
firms to manage expansion. shareholders, stakeholders
and customers;
g Pressure to maintain
growth rates;
Pressure to maintain profit
levels;
Retaining key management
personnel.