Business Model: Amazon versus eBay Essay

A comp anys pipeline model is the activities it uses to stimulate and capture value by means of its offerings to the market. Modelling helps firms dampen business visions and strategies, redesign and align business operations, cope knowledge about the business and its vision and run across the acceptance of business decisions through committing stakeholders to the decisions made (Persson & Stirna , 2001). amazon and eBay both sh ar space in the sell industry of e-re poop and e-commerce services. The two companies suck found advantage by conducting business using the internet by providing products, services, and information to consumers. Although, B2C (business to customer) strategies have helped both companies to achieve supremacy they have sustained and dominated the market through evolving business models that capitalize on value domain to the consumer. eBays business model is based on creating an online trading community where the caller-out provides an auctioning pla tform that brings vendors and buyers together. Thousands of items be listed in catalog form according to national and category. eBay at no time takes possession of any item which leaves shipping costs details among the buyer and marketer. However, it does offer secure payment methods informal of charge.On the other hand, amazon incorporates a gigantic tail retail business model which assumes that products that are in outset demand or have low sales volume can jointly get a foresighted up a market bundle that rivals or exceeds the relatively few current bestsellers and blockbusters, save tho if the store or distri howeverion broadcast is volumed enough (Investopedia, 2014). By offering a large variety of products on its sites for sell scroll is kept in what the company terms as fulfilment centers. Whereas when merchandise is selected and paid for through viragos e-commerce site it is shipped free or at little cost to the buyer. The value creation does not end once th e exchanges of goods have taken run for both eBay and amazon they have extended the doing process by incorporating feedback forums. For example eBay depends on the righteousness of others in making person to person respectable transactions there is a feedback forum where the seller and buyer can comment on the process. Amazon in turn has created customer value and dedication by offering a comment constituent where buyers can rate experience on a star arranging, and provide reviews.The seller is tracked by Amazon using ametric system based on number of reviews and ratings in percentages presentment how much positive feedback a seller has genuine in a specific time. heavily and leverages its frosty assets to and On the other hand, Amazon beginning as an online book seller utilizing B2C strategy quickly redefined its retail strategy to embroil large varieties of products that are stored in what it The company in compensation charges listing fees or insertion fee to promote the product, and a last sales price fee of 7.9% once the last bid is accepted. Through these activities eBay creates value to the consumer by providing a vast listing of items for sale in unmatchable location, ease of use, and security in financial payment methods. Although, eBays business model is built virtually its core competencies of on-line person to person auctioning Amazon has taken a more innovative set out by redefining its business model and creating entirely newfound markets. Amazon beginning as an online book seller utilizing B2C strategy quickly redefined its retail strategy to include large varieties of products.While incorporating a long tail retail business model which assumes that products that are in low demand or have low sales volume can collectively make up a market share that rivals or exceeds the relatively few current bestsellers and blockbusters, but only if the store or distribution channel is large enough (Investopedia, 2014). Hence Amazon dumps im provident term profits for long term investments a good deal making the company appear not juicy in its financial statements. Amazon through business model innovation (BMI) evolves by thinking long term continues to fill the white space by focusing and then capitalizing on the unmet needs of consumers. The company since inception in 1995 Amazon started off by focusing on Business-to-Consumer relationships between itself and its customers, and Business-to-Business relationships between itself and its suppliers but it then moved to incorporate Customer-to-Business transactions as it realized the value of customer reviews as expose of the product descriptions. t is when an online company earns its revenues mainly by selling a broad selection of products.