By: Corey Daigle, Megan Foreman, and Seth Fraser

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By Corey Daigle, Megan Foreman, and Seth Fraser
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Overview

• Who we are, What we sell, and Where we are
• Mission and Vision
• Internal Assessment
• - Financial Condition
• - IFE Matrix
• External Assessment
• - EFE Matrix
• - CPM Matrix
• Strategy Formulation
• - SWOT Matrix
• - Space Matrix
• - IE Matrix
• - Grand Strategy Matrix
• - QSPM Matrix
• - Matrix Analysis
• Strategic Planning for the Future
• EPS/EBIT
• Decisions/Implementation/Evaluation
• 2004 Financials

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• Headquarters
• Stock Symbol EBAY (NASDAQ)
• All graphics and information were found on the
  eBay website www.ebay.com

eBay Inc.2145 Hamilton AvenueSan Jose,
California 95125
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Who we Are

• Founded in September 1995, eBay is The World's
  Online Marketplace for the sale of goods and
  services by a diverse community of individuals
  and small businesses. Today, the eBay community
  includes more than a hundred million registered
  members from around the world. People spend more
  time on eBay than any other online site, making
  it the most popular shopping destination on the
  Internet.

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What we Sell

• On an average day, there are millions of items
  listed on eBay. People come to eBay to buy and
  sell items in thousands of categories from
  collectibles like trading cards, antiques, dolls,
  and house wares to practical items like used
  cars, clothing, books and CDs, and electronics.
  Buyers have the option to purchase items in an
  auction-style format or items can be purchased at
  a fixed price through a feature called Buy It
  Now.

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Where we Are

• People from all over the world buy and sell on
  eBay. Currently, eBay has local sites that serve
  Australia, Austria, Belgium, Canada, China,
  France, Germany, Hong Kong, India, Ireland,
  Italy, Malaysia, the Netherlands, New Zealand,
  the Philippines, Singapore, South Korea, Spain,
  Sweden, Switzerland, Taiwan, the United Kingdom,
  and the United States. In addition, eBay has a
  presence in Latin America through its investment
  MercadoLibre.com.

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eBays Community Values

• eBay is a community that encourages open and
  honest communication among all its members. Our
  community is guided by five fundamental values 
• We believe people are basically good.
• We believe everyone has something to contribute.
• We believe that an honest, open environment can
  bring out the best in people.
• We recognize and respect everyone as a unique
  individual.
• We encourage you to treat others the way you want
  to be treated.

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Existing Mission Statement

• eBay's mission is to provide a global trading
  platform where practically anyone can trade
  practically anything.

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Proposed Mission Statement

• eBays mission is to be the worlds most
  utilized and profitable trading post. Having
  bright and talented employees that are dedicated
  to serving both customers and communities, eBay
  provides the most technologically advanced,
  reliable, and secure trading platform available
  to anyone, anywhere, while always doing business
  in a highly ethical manner.

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Proposed Vision Statement

• Our vision at eBay is provide an online
  business to enable anyone to auction practically
  anything.

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External Audit
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EFE Matrix
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(No Transcript)
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CPM
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Internal Audit
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Key Financials

• End of year 2003
• Net Income grew to 442 million, up 77
• Resulted in record operating cash flows of 874
  million, up 82
• Year end Balance Sheet
• 5.8 billion in total assets
• 2.7 billion in cash and investments

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Key Financial Ratios

• 
  Company Industry Sector SP 500
• Valuation Ratios
• P/E Ratio (TTM)
  97.12 41.01 28.90 24.01
• Beta
  1.77 1.30 0.96 1.00
• Growth Rates
• Sales - 5 Yr Growth Rate 90.58 35.47
  17.25 9.30
• EPS (MRQ) vs Qtr 1 Yr Ago 55.07 27.30
  15.43 28.69
• EPS (TTM) vs TTM 1 Yr Ago 60.76 27.58
  16.37 21.92
• EPS - 5 Yr Growth Rate 111.74
  43.79 15.23 12.15
• Financial Strength
• Quick Ratio (MRQ) 3.13
  1.22 0.93 1.26
• Total Debt to Equity (MRQ) 0.03 0.73
  0.82 0.85

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Key Financial Ratios

• 
  Company Industry Sector SP 500
• Profitability Ratios
• Gross Margin (TTM) 80.78
  42.23 42.84 47.32
• Gross Margin - 5 Yr Avg 79.48
  41.08 42.06 47.01
• Operating Margin (TTM) 29.01
  11.97 12.90 20.33
• Operating Margin - 5 Yr Avg 16.21 6.75
  11.21 18.35
• Net Profit Margin (TTM) 21.00
  7.76 7.54 13.12
• Net Profit Margin - 5 Yr Avg 13.53
  3.74 7.62 11.59
• Management Effectiveness
• Return on Assets (TTM) 9.10
  8.29 5.91 6.40
• Return on Investment (TTM) 10.18 11.53
  7.98 9.97
• Return on Equity (TTM) 10.50
  14.04 13.51 18.71
• www.investor.stockpoint.com
• March 2004

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eBay Stock Information

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eBay Stock Information

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Strengths
eBay is the most well known online auction
company in the world.
1.
2.
Strong auction community of loyal customers.
3.
Excellent financial situation.
4.
Have a fair payment system that encourages
merchants to list products.
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Strong presence in strategic global markets.
6.
Experienced management team.
7.
eBay has very little inventory since they do not
actually take position of items sold on their
site.
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Strong customer service.
Percent of revenue in international markets
increasing significantly.
9.
Easy URL to remember.
10.
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Weaknesses
1.
Weak promotional and marketing activities.
2.
eBay does not pay dividends on their stock.
3.
Some customers feel the website is cluttered.
4.
eBays position in the business to business (B2B)
market is weak.
5.
eBay has very little debt, therefore the company
is not taking advantage of low interest rates to
expand.
6.
eBay has a higher tax rate since they do not take
advantage of depreciation as well as other
companies.
7.
The company relies too much on word of mouth
advertising, assuming everyone already knows
about eBay.
8.
The company does not do enough to convince leery
potential customers that Internet business is
financially safe.
Longer transaction times, since many merchants
will not receive payment until a buyers check
clears.
9.
10.
eBay is mainly a cash business.
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The Matrices
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SWOT Matrix
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(No Transcript)
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SPACE Matrix
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IE Matrix
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Grand Strategy Matrix
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QSPM
QSPM
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(No Transcript)
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Suggestion/Recommendations

• New Strategies
• Expand to all countries of the world
• Cost 500,000.00-1,000,000.00(advertising)
• Advance in security of personal information
• 1,000,000.00
• Increase in Industry
• N/A
• Increase revenues by capturing more customers
• N/A
• Look into new pay system or create own (PayPal
  only in 38 countries)
• Millions

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• We believe that our continued profitability at
  historical levels will depend in large part on
  our ability to do the following
•  attract new users and keep existing users
  active on our websites   
•  manage the costs of our business, including the
  costs associated with maintaining and developing
  our websites, customer support, transaction and
  chargeback rates, and international and product
  expansion   
•  maintain sufficient transaction volume to
  attract buyers and sellers   
•  increase the awareness of our brands and   
•  provide our customers with superior community,
  customer support, and trading experiences.
• excerpt from eBay Annual Report 2003

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EPS/EBIT Analysis

• Amount Needed 1,500
• Stock Price 45
• Tax Rate 80/16240
• Interest Rate 5
• Shares Outstanding 609

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(No Transcript)
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Decisions

• Primary
• Expand aggressively into China
• Secondary
• Increase business to business operations
• Increase marketing campaigns in Asia

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Implementation

• Objectives
• Create a fully translated Chinese eBay site
• Increase sales by 35
• Increase number of registered users

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Evaluation

• Quarterly Yearly Financial Statements
• Annual strategic meetings of division
• management and corporate management

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2004 Financial Information

• More than 104.8 million registered users
• 327.7 million items
• More than 8 billion in gross merchandise sales
• All from first quarter of 2004

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eBay in the News

• March 8, 2005eBay Launches Classifieds Web
  Sites
• February 23, 2005eBay Completes Acquisition of
  Rent.com
• December 1, 2004eBay Launches Service for
  Malaysia