Analysis of Ebay China’s Failure and Suggestions to Ebay’s Return Strategy from the Perspective of Cross-Cultural Conflicts

Topics: Cross-cultural communication, China, Geert Hofstede Pages: 21 (7588 words) Published: April 16, 2013
Analysis of eBay China’s Failure and Suggestions to eBay’s Return Strategy from the Perspective of Cross-cultural Conflicts

1. Introduction
Along with the development of global economy, no one is unfamiliar with the word of globalization, and the world is filled with multinational-corporations. In such circumstances, those companies have realized that the necessary way to survive in the global market and maintain the competitive advantages is to enlarge the geographical scope of their business. As a result, the issue of localization strategy is put into the essential agenda of every multinational-corporation’s meeting. Culture, as an invisible hand, leads the multinational-corporations towards the right way in the localization. While, cross-cultural conflicts are the basic obstacles in the localization. As another meritorious statesman of the globalization, Internet played an important role in the global market. Thanks to the internet, a great deal of international business can be done without travelling around the world and face-to-face communication. And the development of e-commerce brought a fresh new way of doing business online. There were a lot of internet companies launched during the last few decades, and increasingly more people began to buy things on the internet instead of shopping in real stores. The internet has been imported in China for seventeen years, and nowadays China owns the largest amount of netizens in the world. Therefore, many famous internet companies want to share a piece of cake in such a big market. If any one of them can open Chinese market successfully, it will definitely make a huge profit. There are some senior internet companies being in China for a long time, and eBay was one of them. But are these companies running as well as the ones in other places? How to solve the cross-cultural conflicts in management and marketing and how to make the proper localization strategies adapt to the whole mainland China? All those questions are in front of managers of multinational-corporations. eBay Inc., as the biggest shopping website worldwide, was one of the notable successful stories of the dot-com bubble, and it is extremely successful in the US and other western counties. But when eBay expanded its market to Asia, especially to China, there were a lot of obstacles in front of it. After some struggling, eBay finally had to leave the Chinese market in 2006. But six years later, in December 2012, when millions of Chinese netizens were shopping on Taobao.com, the most famous e-commerce website in China, eBay quietly came back with the combination with another Chinese shopping website called Zouxiu.com. The thesis is going to study the cross-cultural conflicts that eBay Eachnet had met in the old days, and analyze the reasons and influences of the conflicts. Also the thesis will give some suggestions to the strategies of eBay’s return to Chinese market from the perspective of solving the problem of cross-cultural conflicts, in order to offer concrete measures for other multinational-corporations to handle the intercultural problems in China better than ever. The localization strategy of effectively collaborating cultures in the thesis will show the theoretical significance in improving the competitive advantages for a multinational corporation. First of all, the thesis will give a brief introduction about eBay’s development in the world, especially the success in western countries and the failure in Asia. And then, the author is going to analyze the underlying reasons why eBay failed in Asian market from the perspective of cross-cultural conflicts. In this section, the author uses two theoretical models, Hofstede’s cultural dimensions theory and ethnocentrism theory. And then, according to the mistakes that eBay had made in the old times, the thesis will give some suggestions for the new “eBay Style Show” based on a...

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