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Changing Times Make for Unhappy Ebay Customers

Essay by   •  November 27, 2010  •  Research Paper  •  1,465 Words (6 Pages)  •  1,208 Views

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Changing Times Make for Unhappy eBay Customers

How much is too much, or how much is enough? This is an economic question that every successful business will have to evaluate in order to remain an icon in the marketplace. Today's business world is unlike any time in comparison. There has never been more opportunity for small ventures to turn into major financial companies overnight with the use of the World Wide Web. It is true that many of these overnight wonders are short lived and go unnoticed; however we do have the elite group of companies that have made their mark in our everyday lives.

eBay is one of those companies that have made good use of this opportunity. eBay Inc. is considered as the world's leading online personal trading community. Founded in 1995, eBay is available 24 hours, 7 days a week with more than one million registered users. In the 4th quarter 2003, eBay reported a net income of 935.8 million dollars; up 44% and their full year net income for 2003 was 3.27 billion dollars, up 51% for the same time last year. Even with their noted economic success this company still finds a need to raise fees for the use of their service.

On the positive side of the moral and ethical matter, there are great things that eBay offers as well as provides for its customers. People with many dreams of becoming entrepreneurs and starting successful businesses has found eBay and answer to their prayers. Many people who don't have the resources to use an outside place to start their businesses; have used eBay to sell their items straight from their homes to save money. Some of their businesses have even grown so that they are now able to rent a separate space to run their small companies. This is a blessing that probably would have not been a reality if not for the large Internet auction service named eBay.

eBay is not a dirty word in their vocabulary; it is a spring board to independence and an opportunity for a good way of life. Although some have used eBay's services to cheat and steal, eBay has started a foundation that helps in communities all across the country. Meg Whitman, president and CEO of eBay Inc. made a statement; "Giving back to the community has been an essential part of eBay since the very beginning. In 1998, with a donation of 107,250 shares of pre-IPO stock, eBay created a charitable fund known as the eBay Foundation™. Today, eBay Foundation remains an important part of eBay and serves as the primary vehicle through which eBay contributes to community organizations. Annually, eBay Foundation provides grants to numerous non-profit groups that are working to make local communities better places to live and work.". eBay is noted for giving back to not only the community but to its employees as well with gift matching, and charitable grants. This is something that not all companies provide for the people who work for them. Millions of dollars have been giving out in grants, volunteer philanthropy and charitable donations.

Perhaps eBay should police better the activities and practices of the services and items that are offered on their web highway; but that kind of in depth background research would only serve to drive up already elevating operational costs. That would result even more disgruntled customers. It seems so easy for a person or persons with a deceptive nature to use eBay to take advantage of non-suspecting customers; this is the reason for the saying "Buyer Beware". Consumers must be really be aware of internet offers and things that seem to good to be true.

This issue has also caused negative backlash from sellers and has driven eBay's stock down 20% for the first time in two years. eBay has been receiving criticism about raising prices on selling items and the negative feedback has been circulating all over the country. This auction icon could lose some of their sellers to other bidding sites such as Overstock.com or Amazon.com. The other auction sites are not as well known and it will take a few years for these other players to gain the notoriety to rival eBay. Unfortunately the only people who are going to hurt by the negative backlash are the sellers that it affects. This is roughly the large volume sellers and users with eBay Stores. The extra features that are completely optional will cost considerably more with the new price plan ranging from 40% to 52% increases. These small business entrepreneurs feel that their profits are being suffocated with the new extra fees and price hike on certain services. The seller could raise their prices to compensate, but it will deter buyers who are looking for a good deal. There has been a drop in auctions since the plan was announced, but it will only be temporary.

Ultimately, the protests of the eBay Store owner will go relatively unheard and will be ineffective. Since eBay is the pioneer of online auctions, it will be a long time before the other auction sites succeed to become a household name. There will not be a mass exodus of users leaving eBay due to the price hike. Like all other companies that announce price hikes, the urgency and panic of the public make the issue seem

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