EBay in Japan: Strategic and Cultural Missteps
EBay is one of the world’s largest online auction sites in the world. It was founded on September 3, 1995 as AuctionWeb. Every year it would acquire a new business or partnership to add to its own making it very well known and diverse. It was doing well everywhere it decided to set up except until they decided to move into Japan. This is how they got their first learning experience in doing business in Japan.
EBay spent great amount of their time designing add-ons for the Japanese site instead of spending time to advertise. This really hurt them because this led to people not knowing much about them in Japan. Their competitor Yahoo had a strong brand presence and was the best in channeling traffic to and from their websites. They had the right idea by hiring a native of Japan to help them but she was new to the internet business which caused some complications of knowing what trends to follow.
I think EBay should have waited to announce their big transition to Japan because it caused potential competitors to become aware and make the move first. When the announcement was made Yahoo quickly moved to Japan and set up an auction site that was very popular for many years. EBay also removed their listing fees because Yahoo was already the leader and did not charge fees at the time and the people were used to not paying for listing. It caused eBay to try to change what they originally wanted to do in Japan.
One cultural misunderstanding that they did not take notice of was that Japan is a cash based society. This means that the people of Japan would rather pay with cash than using a credit or debit card. One thing they could have done to solve that is to set up actual stores that took cash in exchange for a voucher to use on the website. Another thing that eBay did not know was that the people of Japan did not like to buy items second hand. It means that they like to buy their items brand new and not used from another...