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BUS304 Analysis on Aspects of Marketing and Consumer Decisions: Study on Ebay Assessment 2 Answer


Assessment 2

Assessment Type: Group Report 3,000 ±10% (with maximum four members)

Purpose: Students are expected to analyse the marketing practices in the provided company. This assessment relates to learning outcomes a, b, c and d.

Topic: A practical analysis on aspects of marketing and consumer buying decisions

Task Details: Students will be allocated to groups to analyse marketing programs and buyer behaviour process in one of the following companies.

eBay Westpac Qantas Kmart Telstra

Specifically, students must answer the following questions:

  1. Discuss the importance of developing effective marketing strategies, and how consumer influences drive the marketing strategies of the chosen company.
  2. Analyse how internal factors such as those relating to perception, motivation, learning, attitudes, and personality/psychographics influence consumer buying decisions of the chosen company.
  3. Analyse how external factors such as those relating to reference groups, social class, culture and market forces influence consumer buying decisions of the chosen company.
  4. Discuss how the consumers of the chosen company apply the decision-making process when making purchases.
  5. Discuss the importance of digital marketing in today’s environment and the influence of digital marketing practices on consumer buying behaviours of the chosen company.

The work should be in the format of a business report as you would submit to the CEO or management of any business, in a professional style.

The report must contain:

  • Cover Page
  • Executive Summary
  • Table of Contents
    1. Introduction
    2. Sections and Sub Sections Covering Question 1 (You Must Choose Suitable Headings)
    3. Sections and Sub Sections Covering Question 2 (You Must Choose Suitable Headings)
    4. Sections and Sub Sections Covering Question 3 (You Must Choose Suitable Headings)
    5. Sections and Sub Sections Covering Question 4 (You Must Choose Suitable Headings)
    6. Sections and Sub Sections Covering Question 5 (You Must Choose Suitable Headings)
    7. Conclusion
    8. List of references that align with approved referencing format
    9. Appendices as required

The report will be marked based on the criteria listed in the assessment rubric.

It is very important to note that research is a key criterion that will influence the mark you earn. Research is considered appropriate when students develop the report by using peer-reviewed journal articles. While using a minimum of sixteen (16) journal articles is expected, students will only achieve a top mark in their research component when they use between twenty (20) and twenty eight (28) research sources. Please note that many of the references you use must come from peer reviewed journal articles and that these articles should not be the same as the ones provided in the textbook and tutorials. Furthermore, please note that using Wikipedia and other online encyclopedia is not allowed and may result in being given a fail grade for the work. If you need help in finding suitable sources for the work, please seek assistance by booking an appointment with a librarian.

The assessment’s length is 3,000 words (+/-) 10%. The word count excludes the cover sheet, table of contents page and references.


Executive Summary

The aim of the study is to understand the marketing practices and the influence of consumers on the strategies of a company. To support the innovation and spirit of tomorrow is the central mission for a company. This study has been made in the context of the renowned company eBay which is a multinational e-commerce corporation. This company facilitates the business between consumer to consumer and business to consumer. A consumer has the power to influence an effective marketing strategy that can transform the world of consumer behavior. In today’s competitive market, the right strategy is important to promote a business. In this present study, it is focusing on the impact of various strategies. It enlightens the fact about the importance of effective business strategy and its impact on consumer influence.  This study investigates the external and internal influences that drive the strategies. It also clarifies the external and internal factors that can influence the buying decision and purchasing behavior. This study also investigates internal factors like perception, learning, attitude, motivation, and personality that can influence consumer behavior. It can focus on the external factors and their influence on purchasing behavior. The study highlights the purchase behavior is also motivated by the decision-making process.  It also focuses on the importance of digital marketing strategy and how this strategy does is helpful in today’s world. This supports the understanding of the effective digital marketing that makes an influence on purchasing behavior. An investigation is done based on the relationship of data that can collect from secondary resources.

1.0 Introduction

eBay is one of the biggest multinational e-commerce companies based in California, USA. It is the largest online marketplace where one can buy and sell various range of products including electronic goods, cars, clothes, and many more. This research paper deals with the marketing strategies the Company uses to influence the buying needs of the consumers. It also focuses on various internal and external factors that affect consumer behaviour. The decision-making policy of the consumers is also analysed and how digital marketing affects the mind of the customers is also taken into consideration. Finally, the research concludes about consumer behaviour related to the customers of eBay.

2.0 Importance of developing effective marketing strategy:

A perfect strategy is the brick of any global business model. The marketing expansions of the international company eBay has spread its wings through a perfect strategic plan of orientation.  The potential expansion of the company and its global exposure are based on effective strategies. It can be explained by the marketing mix strategy that helps to establish the interconnections between marketing approaches.

Product strategy

This strategy can fulfill the requirement of both buyers and sellers on an online platform.  It is classified into three important aspects like the core of the market place, exchanges of a ticket, and classified service. In the Australian market of eBay, marketplace service plays a key role to make a perfect deal between vendor and customer. The innovation in products can create a center of attention to the customer (Muhammedrisaevna et al. 2020)

Place Strategy

This strategy is really important to focus on the place where eBay can distribute their product in their target customer. eBay can distribute their products through effective channels like API (Application Programming Interface) which helps to reach their target market. The virtual presence in mobile apps and official websites through digital marketing magnetizes the customer.

Promotion Strategy

An effective promotion strategy is to manage the needs of the customers and help to share the global market in the e-commerce industry (Chen & Li, 2020). A well-defined promotion strategy at eBay helps to promote the advertisement through various mediums such as television and other media. It helps to generate the budget revenue of an advertisement that emphasize on increasing the sale and helps to fulfill the goal of the company. The online advertisement can make brand awareness which can attract customers.

Pricing strategy

This strategy is helpful to meet the company’s profit and helps to achieve the goal of the company. With the help of a dynamic pricing strategy, a company can supply with the framework of sale and meet the customer’s expectation (Zhao et al. 2020). For example- they are arranging discount coupons for shoppers and a low pricing rate can lure their customers.

Influence of customers drive the marketing strategy 

A consumer’s culture, values, demographics, income, and social class can influence the price and placing strategy of the company. The way of influencing is very pertinent to discuss. For example, a community’s income level and social class influence a company's pricing strategy. Like if the income range is lower for any community then the company will make a flexible pricing strategy that helps the customer to buy that product. On the other hand, the company will design the place of distribution that can be achieved by any particular population.    

A consumer’s needs, motives, emotions, perceptions, personality, lifestyle, and attitude make a huge impact on product and promotional strategy.  For example, the product selection of a consumer is relying on his lifestyle and attitude. A company can intend its innovation according to the need and perceptions of the customer. The promotional strategy is depending on the motives and emotional perception of the customer. A company has to craft their planning strategies to cope up with the needs of the customer. A company needs to identify the most searched products on the internet and the innovations can be made according to consumer’s searching perception (Cheung et al. 2020).

3.0 Internal factors that influence a consumer’s decision-making process:

Perception: Perception helps to give an interpretation to the customer and this interpretation comes from the effective strategy of the company. A company’s brand awareness makes a critical role to create a positive perception among the customer (Rajavi et al. 2019). They can make an impressive logo. They can expose them with the perfect media strategy like they can make some interesting ads where they can show some benefits and interesting facts about the products.  In this way, a consumer will be attracted by this visual description. This thing can lead them to buy that product.  

Motivation: Motivation has a huge impact on the buying decision of the customer. There are lots of motivations of a customer that can come from the company's promotional strategy. Motivation is divided into two major components like manifest motives and latent motives (Herberz et al. 2020). Manifest motives are admitted by the consumer. In that case, they know the reason for buying. A company's innovative product can be the reason for its manifest motive. On the other hand, a latent motive can make an impact to buy the product but the reason for purchase is based on consumer’s perception. Like if they buy any second-hand car then they might think it can demonstrate their success.

Learning: Learning is a process that can make a perception of any product. Learning is creating an impact on the purchasing behavior of a customer (Wu & Li, 2018). A consumer can learn about the product through the strategy of the company. A company can make a brand image that can influence marketing. They can upload some interesting videos on the internet and analyze the benefits and product descriptions. In this way, a consumer can learn the advantages and that makes a clear perception about that product. As a result, this learning process will help to buy that product.    

Attitude: A company’s positive attitude and mindset can impact the consumers (Murphy & Dweck, 2016). This attitude comes from the satisfaction of the customer’s needs. EBay needs to promote its ads with confidence and assuring emotional intelligence. The positive attitude of the company touches the mind of the customer. On the other hand, a consumer’s attitude is depending on the belief in that particular object. If they believe then they purchase further on that product.

Personality: A brand personality makes a huge impact on the buying decision. The brand personality can be demonstrated with sincerity, competence, and sophistication of the product (Coelho et al. 2020). It focuses on the belief, sensation, and feeling about the product.  In the case of that people do not like any sad conception of the product. They do not enjoy it if they are not excited to purchase any product. For this reason, a company can promote its product through some interesting storytelling method. This thing can give positive vibes to the customer and this thing helps to buy that product.

4.0 Influence of External factors on consumer buying decisions

Consumer behaviour is defined by the process of acquisition, consumption, and disposition of goods, services, and experiences by using human decision-making skills over a certain period (Hoyer et al. 2020). The external factors that have an impact on the mind of consumers are related to reference groups, social class, and culture, and market forces. Henceforth, several factors such as the search engine of a company and also other stuffs influence the buying of customers significantly (Quester et al. 2013). 

Reference groups: Buying a certain product is regulated by the influence of the group of people a consumer is related to. The customers are always influenced by the trend that is followed in the market. A consumer is suggested about a Company or its products which helps in the decision making of what it should buy. The visible products like clothes, shoes, and accessories are more impacted by the references. Sometimes people get motivated by a group of skilled individuals who possess greater knowledge and understanding of things (Verma, 2018). All these are reference groups controlling the mind of the consumers.

Social class: Social class is a key factor while analysing the buying capacity of consumers because the behaviour for a particular social class is similar. It should be noted that only income does not define a class. There are other factors like education, occupation, and wealth that determine the class for a group of buyers. There exist three classes in the society: upper, middle, and lower class (Ramya & Ali, 2016). Extravagancy in buying is seen in the upper class to maintain their status in society. The lower class buys on impulse and the middle class chooses products meticulously after the doping market survey. eBay must formulate its production strategies by reviewing the social class for its target group. Online marketing has a global impact which implies that the intended social group is diverse (Verma, 2018).

Culture: Culture is integral to every society. Culture influences our everyday life starting from the food we eat, what we wear etc. People from different countries have different tastes for goods depending on the influence of society. Culture gets transmitted from one country to another due to globalization. Culture is passed from one generation to another hence the process to select a cultural group is arbitrary (Ramya & Ali, 2016). A multinational company has a greater challenge as it has to meet up the expectations of groups from various parts of the world having diverse cultures and ethnicity (Verma, 2018).

Market forces: Market refers to the socio-economic condition of the country where the business is operating. The market forces influence the price of the product and the promotional strategies that can be used for publicity. The economy of developed countries is more stable as compared to developing ones and it influences the ability of customers to buy an item. The pricing should be done according to consumer status.  In a highly competitive market of online business, where every rival is selling similar products, the only way to sustain is building a reputation and pricing strategy which includes discounts and free delivery in certain products. eBay follows a personal price-aware multi-seller recommender system (PMSRS) which model’s customer’s willingness to pay (WTP) for a particular product. This model has proved to be very effective for the company (Greenstein-Messica & Rokach, 2018). eBay’s revenue amounted to 2.86 US dollar in the second quarter of 2020 (Referred to Appendix 1).

5.0 Decision-making process of the consumers

Consumer behaviour Marketing strategy of an organization lies in identifying the moment that matter” when a consumer can be best convinced to buy a product. This operation is defined by a traditional funnel that has stages like awareness, familiarity, consideration, purchase, and loyalty. It is the job of the company’s marketing experts to move a customer from one side of the funnel to the other. The consumer starts with a set of choices and gradually the choices narrow down and it ends with a particular company’s product (Stankevich, 2017). But in today’s world, online purchase influences consumers by showcasing different product models with attractive pictures and prices. The competition is stiff for eBay as many other options are open to buying products online from other web-based companies. 

Decision-Making Model 

The traditional decision-making model includes five different stages (Stankevich, 2017): 

  • Need recognition
  • Information search
  • Evaluation of alternatives
  • Purchase
  • Post purchase Behaviour?

At the first stage, the consumer needs a recognition that he/she needs to buy a product. It may arise internally or create by the marketer. The marketer must play a mind game by creating an imbalance between the consumer's original and preferred status. The imbalance will create insecurity which forces them to purchase. Promotions through online advertisements in various social networking sites help in achieving the target. The second stage is crucial when a consumer goes searching for information about the product on the internet. The market trend regarding a particular product from a company affects the choice a consumer can make. 

Effect of involving consumers in online business- The online market is highly volatile. To build trust among consumers is a difficult job. Involving consumers within the business may build faith in their minds which will influence their decision-making strategy. The marketers can invite customers for suggesting new products and services. Ideas regarding advertising, slogans, and innovative logos from the consumers can be encouraged by the organizations which make them feel like part of the organization (Tzeng & Shiu, 2020).

Improving pre-purchase experience through promotions: eBay provides a platform for promoted listings in search engines where the ad is visible in prime locations of the search engine. The seller need not pay anything if the ad does not lead to a sale. Previous experience of buying similar products and also experience of family members, friends influence this stage. It is the role of a company to promote its products (Stankevich, 2017). Here comes the concept of pre-purchase experience. The journey from a search of products to purchase is an innovative process where the consumer needs to be convinced about the product. Customer journey mapping strategy helps in gaining information that repeats purchase is not very common but high traffic is observed in search engines for already purchased products. A company website must improve the pre-purchase experience by creating filter options on their websites based on price, discount, etc. The search engines must give a smooth and error-free journey that influences the customers purchasing trends. In the case of cell phone and accessories, options of inter product compatibility, offers, and reviews regarding complimentary items are provided which increases the sales of products (Gürvardar et al. 2016). In the third stage, the consumer evaluates the product in terms of its price, longevity, quality, durability, warranty period. All these features are properly provided on the eBay website along with feedbacks from other buyers. The fifth stage is when the purchase is finally made. At the very last phase, the consumer is still in two minds regarding the need for purchase. It is particular in case of complex purchases like cars, computers, mobile phones, and other electronic devices having high prices and considered as luxury items. The online retail platform like eBay keeps the consumers hooked to their products very efficiently in these delay periods. The top 100 eBay listings of products were analysed and the statistics show that the number of products sold is 4.3 items per week and an average price of $79.25 (Referred to Appendix 2). The final stage is post-purchase where consumer shares their experience of the product. Feedback forms and star ranking techniques are used to give opinions about the quality of the product. This stage is very influencing regarding the fate of a product as it affects the future rate of sale. eBay’s success rate is commendable and it is still in progress (Sharma, 2016). 

Success timeline

Figure 1: Success timeline 

Source: (Sharma, 2019)

6.0 Importance of digital marketing and its influence on consumer’s buying behaviours: 

4 P’s in digital marketing: Marketing is related to any business as it creates awareness among its consumers regarding the product it can buy or sell, the price assigned for the product, and the proper promotion of products in the proper place. These are the 4 Ps of marketing. In the era of digital marketing, the consumers are millennial, and selling and buying are mostly done through the internet. The marketing for products needs to be done on web-based platforms for attracting new generations. Digital marketing is a new paradigm where the impact is on a large group of customers across the globe. The buying and selling of products through online medium can be efficient (Kingsnorth, 2019). Starting from the price to the materials and equipment used in the product, the price range for each product is provided for the consumers. The consumer is left with numerous options based on their demands. A comparative study of similar products from different companies is possible which a challenge to sustain in the market is. Studying consumer behaviour plays a significant part to overcome this phase. eBay is a platform where both the buyers and sellers can meet and complement each other’s needs (Website Design Company, 2020). It is advantageous for this company as compared to other e-commerce competitors who do not provide the seller option. The promotion is made by giving their video s on other websites and creating pop-ups in social networking sites. For a digitized process, the place is the whole world of web technology. It is found that a company can attract as well as influence the buying behaviour of customer by advancing the technology implemented within the company (Business insider. 2020). A large group is targeted where millions of users are hitting the website of the company. The maintenance and innovation in their web-based promotional measures are the crucial factors in the company’s digital marketing.

 Distribution pattern of eBay

Figure 2: Distribution pattern of eBay

Source: (Website Design Company, 2020)

The social dilemma in the digital platform: The reputation of a company is dependent on the feedback provided by the consumers. A quantitative approach (giving a “thumbs up”) and qualitative approach (writing a few lines of text) are followed while analysing the product behaviour through the web. Negative feedback highly influences the impression of a company’s product. A company can easily sustain its business growth by anticipating the consumption behaviour of customer and also by showcasing the social responsibilities of the company (Gupta and Singh, 2020). The growth of e-commerce ensures that the opinions spread very fast and any previous comment from a buyer will influence the next product buying decision. The seller may also put their comments which are counter questioned by the buyers. All these happen in an open platform which is a challenge in the era of digital marketing. Alongside this, an organisation needs to ensure the scent stimuli in order to get positive responses from customers (Rimkute et al. 2016). The overall score of any product needs to be analysed rather than focusing on a few comments (Snijders et al. 2017). eBay follows a decentralized aggregation system where consumer’s privacy is restored. Sensitive information is collected with absolute privacy. The ratings should be confirmed to be in the prescribed range (Azad et al. 2018).

The positive influence of feedback: In previous marketing policies of offline systems, more privilege was for the sellers as compared to buyers. The buyers were never given proper information. In the present context, the buyer gives an opinion about the product. The sellers cannot move in the path of opportunistic business as the feedback influences the next buyer. Sellers have to remain transparent about their products. The open market gives equal status to both buyers and sellers where everyone is benefitted. But a buyer also must not misuse their right to give reviews and providing unnecessary negative comments regarding a company and its products. eBay uses this feedback system and its benefits are commendable which encourages for betterment (Dib et al.  2019).

Effective selling strategy in the digital market: eBay uses the model of classification and regression Tree (CART) (Tu et al. 2019) for identifying the most effective online selling strategies. The process is related to data mining which involves analysing the data available in the network regarding the purchase trend, market criteria, and customer preferences. 

7.0 Conclusion

The consumer behaviours are the essential component for any business organization as it affects the sale of products which in turn decides the amount of profit earned by an organization.  It is part of the organization's activities to influence consumer behaviour positively and attract them towards the products of the company. eBay follows proper marketing strategies, digital platforms, feedback mechanisms to regulate consumer needs and demands. The process is performed through surveys regarding the current trends, the products of its rival companies and introduces new features to sustain in the market. eBay has retained its name and fame for a long time in its area of business. It has maintained its reputation and trustworthiness among its potential consumers. Consumer behaviour is influenced by the facilities provided by the company while buying a product. In the era of digitization, every other company is fighting for achieving a good name in the market. Consumers are given more options that overburden their thought process. The decision strategy is difficult to achieve for the buyers. eBay is a good platform where the product can be viewed from both the buyers and the seller’s perspective which eases the process of selecting a particular good from the ample choices.

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