Ebay

1. Why has eBay succeeded as an online auction marketplace while so many others have failed? eBay’s success truly created a pricing revolution by allowing buyers to determine what they would pay for an item; the result pleases both sides because customers gain control and receive the best possible price while sellers make good margins due to the site’s efficiency and wide reach. eBay’s business model is based on connecting individuals who otherwise would not be connected. eBay’s originators did two things well: they worked hard to make their Web site a community, and they developed tools to help reinforce trust between strangers. eBay’s millions of passionate users also have a voice in all major decisions the company makes through its Voice of the Customer program. The result is that users (eBay’s customers) feel like owners, and they have taken the initiative to expand the company into ever-­‐new territory. eBay continues to expand its capabilities to build its community and connect people around the world by adding services, partnerships, and investments.

2. Evaluate eBay’s fee structure. Is it optimal or could it be improved? Why? How? eBay's pricing structure was