eBay has established a great deal of loyalty for the brand, which guarantees inventory and extends the perceived competencies for the brand. Other retailers' ability to give eBay a run for the money will depend on how successfully they will be able to extend their brands into the auction space. Successful brand extensions depend on whether customers believe the offer fits with the core competencies of the company and with the core values of the brand.
All things being equal, we can assume that Amazon will fair a better chance of competing with eBay because their core competency fits squarely in the retail space and auctioneering is a logical extension. Amazon customers equally have a greater degree of trust with the brand than Yahoo customers for the kinds of leaps of faith that auction retailers require. So, Yahoo and Google will have to work much harder than Amazon to compete with eBay, but this does not rule them out.
Itís also worth considering any new entrants into the space, but the network effect will pose a tremendous barrier to the market. While the internet greatly reduces this barrier, awareness building and trust still need to be built the old fashioned way.
Another interesting question to consider is whether the online auctioneer will be able to make use of the LONG TAIL phenomenon: the ability to coordinate auction items with each other. For example, if you buy a set of turn-tables, will the auction site offer you LPs as well? The kinds of obscure product listings lend themselves well to take advantage of the long tail. But the complexities of matching products and classifications will be a big challenge for the retailer.
Aaron Shields, Partner, Brandinstinct - August 1, 2005
Ebay is the original. As long as they keep moving with the times and innovating while identifying other parallel niches the customers are interested in then it will remain #1. (Yes its unstoppable!)
Allison Toner, Social responsibility designer, www.nicheforecasting.com - August 2, 2005
China may present a particular problem for eBay on two fronts. First, Chinese competitors such as Taobao, which not only appeal to consumers in terms of national pride, but also may get some protection from government organizations (such as the telecom / internet departments still widely controlled centrally).
More importantly. In a developing e-commerce nation such as China, where trust of online financial transactions is shaky at best, all it would take is one giant scandal to hit the papers and get carried to everyone. Such a disaster would likely taint eBay for years in a nation already wary of corruption and con men.
Mark - August 4, 2005
For sure eBay is able to manage its growth. I thing everyone would agree to the sound practice about leadership - who starts as leader continues as leader. Froogle, Yahoo! and Amazon! are great followers and all of them have some niche and some very loyal customers but eBay is and will be a leader who has formed and developed the market. Here the importance is not in figures about growth but in the real power of brand, value of brand.
Please do not over-rationalize branding as this leads only to misconception of what branding really is. Those greatest competitors are good to keep the industry to guidelines, to make it more competitive, but eBay (also owner of Pay Pal) seems to be and to stay the leader in on-line one-to-one interactive sales in nearest future.
Ingus Sturmanis, Communications consultant, publisher, ex DDB, ex TBWA, now working on private consulting projects - August 5, 2005
As long as they command the trust of their customers and trading members, they will grow further and will be a threat to other players like Amazon and Yahoo.
Jathavedan, Exective, Rangsons, Bangalore. - August 6, 2005