Real World Market Term Paper

Excerpt from Term Paper :

Amazon, eBay, and Craigslist

A Real World Market

E-commerce companies promote and sell their products at the online platform. They use the most advanced systems, techniques, and strategies for doing advertisements for their products, making and receiving payments, and managing customer and stakeholder relationships. This paper presents an analysis of the strategies and policies of three top companies from e-commerce industry, eBay, Amazon, and Craigslist.

The paper starts with a brief introduction to these companies by discussing their origin, scale of operations, location, product and service portfolio, and core operational strategies. is an American multinational e-commerce corporation that mainly deals in new and branded products. eBay is an auction website that provides a platform to the buyers and sellers to interact and do transaction in a safe and convenient way. Craigslist is also an e-commerce website where buyers and sellers negotiate for their transactions. If a buyer has to make a choice from these three retailers, he should first look at his need and resources and the availability of the required product or service at the websites of these retailers.

The online retail channel has completely changed the traditional shopping style. This modern style has great implications for the sellers: e.g. they can save heavy advertising and promotional costs, target customers in international locations, provide customized search to the website visitors (buyers) and understand their purchase decision parameters and preferences. In order to win the confidence of its sellers and buyers and enhance its reputation in the local and international community, eBay has taken few steps in the recent past. It has introduced buyer protection policy which provides full coverage to the buyers from online frauds, misrepresentations, and scam from the sellers' side.

In order to avoid criticism and negative response from the sellers, eBay also provides them coverage against any undue advantage which buyers can take from this policy. By introducing this new market, eBay has also contributed in market equilibrium in the United States and other potential locations in the world. Moreover, eBay and Amazon have implemented feedback systems which enable them to get suggestion for improvements from their customers. These steps have largely contributed in strengthening the brand image of these companies among their key stakeholders.

Introduction: Amazon, Craigslist, and eBay:

1. Amazon:, Inc. is an American multinational electronic commerce corporation that promotes and sells a large variety of electronics, household, and consumer products. Headquarters in Seattle, Washington, Amazon is the world's largest online retailer. It was founded in 1994 by Jeff Bezos (the current CEO, President, & Chairman) under the name 'Cadabra'. The company went online in 1995 as The new name was chosen after the world's largest river, Amazon which depicts that sells a huge variety of consumer and electronic goods that are essential to meet the individual and household requirements of the general public (Amazon). commenced its operations as an online books store, but soon started selling music, videos, furniture, consumer electronics, toys, jewelry, apparel, computer software, food items, and video games. Amazon runs totally separate and independent websites for the home country and some other potential markets like Canada, Germany, Italy, France, China, United Kingdom, Brazil, etc. It also provides international shipping services in all other countries of the world. Amazon posts prices and sells only new and branded items in each product category (Amazon).

2. Craigslist:

Craigslist is a classified advertisement website that posts jobs, personals, houses and office buildings on sale or rent, services, gigs, resumes, discussion forums, and community activities. Craigslist was founded by Craig Newmark in 1995 as a simple email distribution service for community events and soon diversified in other classified categories. With the passage of time, Craigslist became popular in the local community with the help of word-of-mouth by website visitors and personal recommendations by the existing subscribers. Headquartered in San Francisco, United States, Craigslist started expanding its operations in all other U.S. cities before going international. At present, Craigslist serves 570 cities in 50 countries around the globe. It does not expend any amount on advertising and promotion -- the only source of community awareness is the word-of-mouth and personal recommendations (Craigslist).

3. eBay:

eBay Inc. is an American multinational corporation engaged in providing consumer to consumer buying and selling services. It is basically an auction website where buyers and sellers meet and do transactions on posted items. Founded in 1995 by Pierre Omidyar, eBay is currently operative in 30 countries around the globe. It is headquartered in San Jose, California. The company's online incarnation, is a platform where buyers and sellers from all over the world can interact with each other at no cost. The company is currently providing standard shopping services in auction style, online classified advertising, online money transfers, and online event ticketing sales services at its website. Millions of items are posted and purchased on eBay everyday; which include home appliances, computers, cell phones, furnishes, collectibles, household and office equipments, automobiles, etc. (eBay).


Implications for Sellers:

By comparing and contrasting each of these websites, the biggest notable difference lies in their selling styles: posts prices of new products offered by all types of small, medium, and large scale manufacturers from all over the world. In addition to the price, the website visitors can also find a product's complete description, features, and necessary information about its manufacturer. On the other hand, Craigslist provides a platform where community members from a particular area or territory can interact with each other for various other purposes in addition to just buying and selling. However, the major function of Craigslist is to bring the buyer and seller together so that they can do transaction at a price which is acceptable for both the parties. Therefore, most of the prices on Craigslist are negotiable.

eBay is quite similar website to Craigslist except the major focus of its services on auction style selling. The sellers can post their items for sale at a specific price on and ask the interested individuals or businesses to bid on the ask price. The party which makes the highest bid can get that product or item from the seller. eBay has become popular in the international market due to its auction style selling which entails a big purchase decision factor, called 'affordability' (eBay).

i. Cost-less Advertising:

All these electronic commerce corporations are facilitating individuals and businesses all over the Globe. Due to globalization and rapid advancements in the mediums of communication and transportation, the selling and buying process has become quite easier than ever before. Now consumers can find product specifications, prices, manufacturer details, and other necessary information by sitting at their home and compare with similar products by other manufacturers. Similarly, the sellers do not have to expend money to advertise their 'for sale' items in newspapers or through printed broachers in the local community. Therefore, these e-commerce websites have become a cost-effective way of advertising and promotion for business corporations and individuals all over the world (Schneider, 20).

ii. Larger Customer Exposure:

Due to these multinational e-commerce platforms, the sellers are able to create awareness about their new products and services to all the potential markets of the world. Similarly, all those individuals and businesses that want to sell their used or non-famous items at a reasonable price can post on eBay and Craigslist. Therefore, these websites have largely increased the exposure of available and ready-for-sale products, services, and properties to the potential buyers.

iii. Eliminating Geographical Limitations:

Due to these huge online platforms, the sellers can easily advertise their products and services outside their distribution reach. They can not only communicate with the local community members, but are also able to advertise in the whole country, or even the entire world. However, sellers can only advertise their products at the international level if the respective online retailer or website (Amazon, eBay, or Craigslist) provides international shipping services for that particular product (Amazon).

iv. Knowing Customer Preferences:

By advertising their products and services on,, and Craigslist, the sellers can easily know the preferences of the website visitors due to the customized search options. These options enable the consumers to look for their favorite products by entering keywords in the search bars. With this option, the sellers can place related items in one product category and increase the exposure of these items to the website visitors (Schneider, 17).

The Best Choice among, Craigslist, and eBay:

All these e-commerce websites have their own advantages and disadvantages. is the largest and the most valuable online retailer in the world. It has a well-established brand image and the largest diversified product portfolio as compared to all other retailers. However, its shipping charges are comparatively higher than eBay. On the other hand, eBay provides an auction selling and buying option which is more convenient and cost-effective way to advertise or buy products, services, and properties at the online platform. Craigslist is also a cost-effective e-commerce channel where buyers meet sellers and find their…

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