EachNet Becomes eBay China
EachNet, China's leading online auctioneer, repositioned
itself as eBay China and added many new eBay features
to its current website. The move brings EachNet closer
to the worldwide eBay network. eBay says that it hopes
to integrate Chinese sellers and suppliers closer into
the worldwide supply chain with this move.
EachNet was purchased in two tranches for a total of
US$180 million in 2002 and 2003.
The website now has more than 4.2 million listings, rising
by more than 38% over the year.
eBay has been consolidating its international leadership
position in auction space by buying other companies such
as PayPal, which has an online payment solution. Since
its acquisition in 2002, eBay has been working to consolidate
its features into its international websites.
In addition, eBay also works with numerous other third-party
companies for delivery, escrow and other services. In
these areas, the eBay
China site is still significantly behind the US site.
A major barrier in China is still online payment services,
which are still not widely trusted by most Chinese. If
eBay China is to expand into more valuable items, it will
have to address this issue.
Until early 2003, many Chinese buyers preferred to meet
their sellers offline before making a purchase. This changed
with the SARS crisis, as people became afraid to meet
each other. As a result, more transactions were done entirely
online. This, in turn, spurred auction site growth.
The new eBay China now confronts two major challengers.
One is a joint
venture between Sina.com and Yahoo!, and the other,
Taobao,
is backed by SoftBank Japan. Taobao has been especially
aggressive in its advertising and marketing in China,
and is seen as a major challenger.
The repositioning also moves eBay China closer into the
commercial non-retail buying and selling market, and puts
it into direct competition with the established players
Alibaba
and Global
Sources. Alibaba, based in Hangzhou, is heading for
a US IPO shortly, and Global Sources is based in Hong
Kong.
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