eBay, by its very nature provides a central location for people to buy and sell unique items, and to meet other users with similar interests. Being the pioneer of the online auction industry, it started out under the brand name Auction Web with the image of auctioning collectibles. This image was quickly shed and Auction Web quickly moved into a diverse range of upscale markets where the Average Sales Price(ASP) is higher. The company earned its revenue’s from levying transaction fees depending on the size of the transaction, hence increasing the ASP was an important point of consideration for the company’s profitability. Auction Web gave way to eBay, and soon enough eBay’s market capitalization surpassed that of even Amazon.com, which made it the most valuable internet retailer in its glory days. The product is the company itself, which facilitates Online Auction round the clock, every day, 7 days a week and 52 weeks a year.
For the first few years, the company did not spend a dime on marketing, relying instead on viral, word of mouth marketing and its ability to piggyback on its competitor’s ceaseless efforts to retain market recognition. However, the company later shifted focus to developing a strong brand and scaling ‘outwards’ (as opposed to scaling up) when more and more competitors entered the e-commerce segment.
