Innovation of New Technology for Amazon and eBay -myassignmenthelp

Question: Discuss about theInnovation of New Technology for Amazon and eBay. Answer: Introduction Incumbents in a business are the individual that looks on the surrounding and offer better services to the customers. It is answerable to all the changes in the market and is primary leading the market place. Until, challenger comes in the market offering the same services as incumbents but with better benefits. For example considering eBay as an incumbent and challenger of eBay is Amazon. Incumbents are holding a place in the market and is been used by the customers but whenever some new company overtakes the market of old company it is called as challenger. Challenger beats the market of incumbent by providing the same services but by offering better options. When challenger overtakes the market incumbents are often overlooked. Challengers create an environment which is better in terms of performance (Scientific Reseach, 2018). In this report we will discuss how challenger replaces the incumbents from the market. As challengers interchanges the customer market by setting a target p rice and rise new opportunity in the market. Disruptive technology is useful for small businesses to make the changes in the way a business is operating so that it grows as a large organisation (Karthikeyan Jonsson, 2016). Incumbents are often beaten by the challengers, who capture the market focus in a short duration of time. Incumbents also try to come up in the market again but due to unavailability of new innovation they lack. Incumbents are already in the market so their name is well known among customers but knowing their drawbacks, challengers overtake the market by serving better products and services (Anthony, 2017). Literature Review In this report considering the example for two well-known companies like Amazon and eBay, where Amazon is treated as a challenger and eBay is an incumbent. Amazon is one of the largest retail companies. It started its business by just selling online books which future got expanded to selling off video, movies, audios, softwares, clothes, accessories, toys and so on (Johnson, 2013). Amazon has successfully beaten eBay as it focuses on customers behaviours by providing them with additional bonus and benefits; because of this the value of market is hiked. Wherein, eBay is an online auction site, who sells its product via showcasing the products online. It is true that challengers can beat incumbents like Amazon crushed the market of eBay. It happens because challengers start their planning at initial stage and work on the area in which incumbents are lacking. They first analysis what services are provided by incumbents in the market so that strategy could be planned accordingly to impro ve the selling budget. Research is the first and foremost step undertaken by challenger as they understand the market, the advantages and disadvantages of the on-going company. So, that better policies could be designed. In case of Amazon, it analysed the market and offered customers to seller their products directly on Amazon without deciding an auction price. In the perception of (Ansari Krop, 2012), eBay lacked the market trust due to some quality issues and scandal act of the products. Amazon worked on this drawback by building trust among customers and selling good quality of products because of this reason market traffic drove towards Amazon. It also enhanced the system by reaching out to customers rather than waiting for the customers to reach out to them. Amazon formed a user friendly platform by providing a good shopping experience to customers as there is ease to access the services as Amazon promises to serve trustworthy products. It was researched in the opinion of (Frankenberger, Weiblen, Gassmann, 2014), it is fact that incumbents are beaten by the challenger like market of eBay has been crushed by Amazon. In todays time Amazon is one of the topmost retail companies and has made a good place in the market by capturing the customers from all sectors. The reason of this success is that it got motivated towards the way to offer services to client at low price in comparison to other incumbents. It focussed on improving the services by reducing the delivery time and resolving the quality issues. Amazon has beaten eBay in terms of customer satisfaction. To overtake eBay market amazon researched on all the plans and redefined it in their own way to beat eBay. It has beaten eBay in terms of customers rating, products available or number of choices available. Like Amazon is chosen by 79% of people as there are wider numbers of options available in terms of products, also 62% of customers choose Amazon because of the customer satisfaction received (Whelan, 2018). EBay is just opted by 9% of customers as number of choices are less and there are issues of fake products. Additionally eBay lack in the market due customer experience as there are no extra benefits provided to them in terms of offers or price. Using these drawbacks challenger (Amazon) redefined the services by planning a new agenda to beat incumbents. According to (Gregg Parthasarathy, 2017), eBay still have the chance to come up again in the market and be stable but it took a wrong direction and was crushed by Amazon. As it stop innovating new products and didnt worked on the customers demand. Amazon worked on this and sold the products at a very nominal price and kept on innovating new products according to the demand of customers (Blade, 2017). EBay stopped working on new ideas and thus failed to adapt to market changes. It only sold the products to retailers who make sure that they will future sell the products in the market and this was the limitation because of which customers lost their interest. As amazon exceled in the market that promises to sell the products in all the sectors which helped to get more target customers. It also made the work from sellers flexible as it assures to write creative the description of the product to be sold, rather than asking seller to write the description. EBay is vanished from the market by Amazon; one of the reason is it stopped manufacturing new goods and kept on selling old products without innovating new products. On the other side as challenger comes new in the market with the motive to make a significant place, creates innovative products and provide offers to customers to grasp their attention. In this case Amazon offered highly automated services to user so customers were required to spend very less amount of time to perform basic functions (Wood, et. al, 2016). EBay still had many un-automated function because of which customers switched from eBay to Amazon. Also the platform was hard to use like it was very difficult to track an item through eBay whereas Amazon updated to users automatically (Nicoli, et. al, 2017). According to (Miguel Casado, 2016),E bay lost the place in the market as it reacted slowly to the changes which were taking place, before amazon customers were comfortable using eBay as there were no other better options available. Emergence of Amazon crushed the market of eBay. One of the major reasons of the failure is, as eBay was a platform for selling goods but they charged on monthly basis from the seller whereas amazon asked seller to pay only when their goods are sold to customers. This increased customers towards Amazon, thus it can be said to beat incumbents challengers often provide better services to customer. Amazon discovered new services for customers like Amazon Prime rollout; it helped in getting more customers to the business. Innovating new ideas is the key success for companys growth (Haucap Heimeshoff, 2014). eBay was limited to offer a marketplace to the customers but it was not flexible for retailers, as retailer need to look for other selling platform. Amazo n identified the need and offered a platform from retailer as well as marketplace. It overtook the customers from eBay by offering additional services needed for fulfilment of business and handling their fulfilment. Innovation is the sole reason that incumbents are beaten by challengers, in this case Amazon kept on launching new services for customers like it stated with selling products via publishing audio, books, videos, movie-streams using digital division that is AWS (Pattie, Hartman, Johnston, 2017). In the view of (Pepper Alves, 2017), eBay is an auction site so the quality of product depends on the seller which cannot be trusted by customers for this case Amazon takes the responsibility about the products sold to the customers so that trust issue is resolved. In case of eBay quality of products were degraded that lost the interest among clients. Amazon resolved the issue of products being scammed thus gathered more customers. Challengers often give the reason to customers why they should choose them instead of incumbents. Similarly, Amazon provided many reasons to customers like offering easier shopping platform, user friendly interface and less time consuming interface. As the products on eBay was sold by fixing an auction price which is a time consuming process thus it cannot be used on a regular basis. Amazon on the other hand offered fast services to users so that user can make the purchase frequently. In the opinion of (McGrath, 2018), old innovators are often beaten by new innovators. This was the reason eBay failed in the market due to the occurrence of Amazon. It lost interest of customers as the feedback from customers was not taken into consideration. Amazon adopted a method to facilitate customers by offering good experience so that they rely on the service for a longer run. When Amazon arrived in the market eBay was somewhere diminished from the market as the competitor offered better services to the customer. New innovative products were launched by Amazon wherein same old products were offered by eBay. The price of product was also a factor that attracted customers. Thus challengers can beat incumbents by offering same services but with better quality or by selling it at lower price (ReseachGate, 2018). EBay being auction site in the market failed as it kept old products on the auction that too with a poor description. Also eBay is operated by third party who connects sel ler and buyer. All the products are sold using third party and they dont have their own inventory section thus the issue of quality occurs. Amazon looks at this issue clearly as it makes every kind of product ensuring the quality is up to mark (Galloway, 2017). Conclusion It can be concluded that incumbents are often crushed by challengers in the market. Challengers often find better ways to engage more customers by delivering better services to user. In this report amazon has gained momentum in the market and have been eBay. Challengers work on the drawbacks of incumbents and design a plan to provide those services which are not offered by incumbents according to the customers need. Amazon offered better trust among people, better trust means more customers this was the reason customers was enhanced towards it. EBay lost the friction from the market due to many reasons which on the other hand gave a boom to amazon as it offered better services among customers. Thus the major shortcomings of incumbents are resolved by challengers; hence they often crush incumbents from the market. References Ansari, S. S., Krop, P. (2012). Incumbent performance in the face of a radical innovation: Towards a framework for incumbent challenger dynamics.Research Policy,41(8), 1357-1374. Anthony, S. D. (2017).The Little Black Book of Innovation, With a New Preface: How It Works, How to Do It. Harvard Business Review Press. Blade, (2017), The difficulties of beating an incumbent. 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