eBay: The China Challenge Part Ⅰ

摘要

When domestic growth slows down, one answer for firms is to increase sales through international expansion, especially in a growing or increasingly sophisticated market such as China. With a well-lined purse and growing ambition to become 'the World's favourite destination for discovering great value and unique selection', eBay, after achieving envious success in other parts of the world, marched towards China in the hope to further establish dominance in the global customer-to-customer (C2C) online auction market. However, what followed in the three years while eBay was in China would forever haunt eBay executives. The story of eBay's failure in China lies in its failure to learn from the lessons of commercial history. Simply stated, senior management exhibited a level of hubris, not uncommon in large organisations. A lack of understanding of the unique nature of the Chinese market, coupled with the unfounded conviction that a strong, successful Western/ Oceania brand and business model would morph immutably to yet another automatic success proved catastrophic. Arguably, poor strategic planning, exemplified by being too slow/reluctant to adjusting their business model and market strategy, and thereby adapt to the nuances of the Chinese market, clearly fuelled the failure. This attitude demonstrated by senior management is recognised in the strategy literature as structural inertia theory, where organisations are often resistant to change because established highly reproducible behaviours have previously delivered business stability.