eBay Inc (NASDAQ:EBAY)’s Competitive Strategy Against Amazon.com, Inc. (NASDAQ:AMZN)


eBay Inc (NASDAQ:EBAY) is planning on how to make a comeback and compete effectively once again with rival online retail giant Amazon.com, Inc. (NASDAQ:AMZN).

A few years ago when the two companies started their journey to fame in the online retail industry, the competitive gap between the two was very narrow. Somewhere along the way, the gap widened as Amazon expanded exponentially, leaving eBay in the sidelines. EBay is now strategizing on how it can come back and compete closely with Amazon once again.

The firm’s main task for 2016 is to prove to investors that it is still registering growth even after cutting ties with online payment firm, Paypal Holdings Inc (NASDAQ:PYPL) last year. Since then, the company has had it rough and the adverse effects translated into weak earnings during the holiday season.

EBay’s CEO, Devin Wenig has a strategy that he hopes will help restore the firm to its former glory. He revealed the plan on Wednesday at the Goldman Sachs Technology and Media Conference that took place in San Francisco. Mr. Wenig stated that the firm was taking a retailer approach rather than operating as a technology website in the marketing and sale of more than 800 million items.

The company initially started out as an auction place for antiques, cars, clothing and other hard to find items. This was eBay’s core business but for the past five years, the company has shifted to other areas such as electronics. The shift was to allow eBay to compete more effectively against Amazon. The primary task is to create a unique appeal that will attract customers to its retail site before they decide to check out other sites.

eBay’s amazing strategy, therefore, presents itself as the biggest challenge. There is no friction in the market, and thus, people can sell all types of goods. However, this approach makes it challenging. The company is creating more data and tools to assist users in boosting their businesses. One example is by urging users to do product reviews. However much the firm is emulating Amazon, it does not plan to venture into logistics like the competition.