A divorce between ebay and PayPal

Since 2002 when eBay acquired PayPal, at a price of $1.5 billion, the merger was successful. PayPal boasted more than 162 million active digital wallet users globally in 2014 and processed some $624 million in payments every day.

However, as more payment companies showed up in the payment market, bundle of two companies seems to be a disadvantage for both ebay and PayPal. They limited each other and start losing chances to corporate with other companies. For example, PayPal after divorce with ebay would be able to corporate with Amazon and Alibaba. Meanwhile, ebay could work with Apple pay and Google wallet.

 “As independent companies, we expect eBay and PayPal will be sharper and stronger, and more focused and competitive as leading, standalone companies in their respective markets,” according to the filing with the Securities and Exchange Commission. “EBay and PayPal also will benefit from additional flexibility and agility to pursue new market and partnership opportunities.”

The arrangement would increase both companies’ competitive power by remaining independent of each other but excluding prohibition on each working with the other’s core competitors.

Like real divorce, if PayPal’s share of the transactions falls below that level, eBay must pay its former subsidiary restitution. The deal will last for six years, including a one-year transition period.

How to make both online and offline shopping more effective

People go to shopping malls to fit clothes and shoes they like and finally make purchase online for better price. The phenomenon exists and is becoming more and more common in people’s shopping behavior. Taking advantages of service from real stores and enjoying a lower price online would finally influence the service quality of entire industry.

There is a store in SoHo called Warby Parker. In the store, tall, carefully stacked shelves with hand-picked literature, vintage issues of Paris Review and comfy mid-century chairs invite weary SoHo shoppers to take a load off and sink into a book. However, Warby Parker is not a library but an eyewear store.

What Warby Parker understands is that the store of the future should be personalized. When a customer walks into a store, he should experience the product instead of being sold products. Building a real user experience is the key to open customers’ heart.

As I said in the beginning, customers go to real store to experience products and buy them online. However, not every product can be reached in a real store. As a result, should online retailers only carry goods that can be tried in real store? No. An online store should also construct an environment for customers to experience their products, especially those unique ones. As a result, the service quality of both real store and online store would keep up. Moreover, customers could experience a enjoyable shopping experience.

PC is not dying

PC, a great invention in human’s lives, is going to lose its popularity. PC brought people a lot of convenience in the past. It increased the efficiency of computation for both academic studies and business jobs. People also entertained with PC to spend their leisure time. However, as technology has been developed so fast, lap tops gradually substitute PC’s position. Some people might think PC is going to come back. I to some extent agree.

The consumption of PC has been decreasing for several years. In 2015, it is even more severe. Market researchers predict that the consumption of PC would decrease by 3.3 percent. The truth shows a worse case that the consumption drops nearly 5 percent this year. Let’s compare the consumption of PC with consumption of iPhones in order to make things more clear. Apple sold more than 74 million iPhones during the last quarter alone. At an annualized rate, that would put iPhone sales alone above IDC’s prediction for the entire PC market. 

Actually, it is not surprising that PC is losing its market to mobile devices. People nowadays rely on laptop more than before. Laptop users save their files in laptops. When they went back home, they have to transfer files onto PC in order to use them. It sounds a little bit inconvenience. Also, the more people use their laptops, this inconvenience would have more power stops people from using PCs. If PC producers could have auto-sync system for PC so that everything people did on their PCs and laptops could go on the same pace, then people might use PC again, because PC still have a lot of advantages. PCs are cheaper than laptops and also have higher configuration. Larger screen also makes PC more comfortable to be used.

If PC died, people just do not want to save it.

resource: http://www.wired.com/2015/03/no-really-pc-dying-not-coming-back/

A win-win digital marketing

Cooperation exists between companies seems to be very common. By cooperating with other companies, a company could focus on its own advantageous side and take advantage of other companies’ expertise. As a result, all companies could get benefit out of the cooperation. However, it is rare to hear that two rival companies cooperate with each other.

Recently, amazon is looking to Alibaba for help in China. As well known, Alibaba enjoy the largest market share of e-commerce in China. Many Chinese people go to Alibaba for online shopping. As data shows for 2014, Alibaba holds 61% market share of e-commerce in China. However, Amazon only has 1.3%. Alibaba and Amazon seem to be direct competitors and not likely to cooperate with each other. Actually, Alibaba and Amazon have different business models.  Amazon sells goods directly to consumers, while Alibaba is an intermediary that connects sellers and buyers, and it makes most of its money from selling ad space on its platforms. Therefore, it would not be a conflict for their cooperation.

By working together, Amazon could get more traffic from Alibaba because most online shoppers in China often go straight to Alibaba's platforms when they want to search for a product. If they work together, more online shopper would go to amazon.cn through Alibaba. The cooperation would also benefit Alibaba by having more prestigious brands to sell on Tmall. Therefore, both Alibaba and Amazon would benefit from this cooperation.

TV ad needs to wake up

As more and more people choose to stay in front of a computer instead of a television, advertisements on a television returns less value to companies than before. In the past, television was one of the best places companies put their advertisements on because most families were regularly watching televisions to spend their leisure time. However, nowadays, TV shows become available to people on Internet and are even more convenient for customers because they can watch whatever and whenever they want. Less and less people choose to spend time on television. As a result, television advertisement does not produce sufficient value for companies anymore.

Another reason why television advertisements do not have high efficiency is that when Internet ad industry was rapidly developing, television ad industry, as the best ad industry, did not think about innovation and kept their old fashion ways of doing advertisements. Obviously, old fashion advertisement ways were inefficient in terms of having accurate targets. As people know, when people surf on the Internet, browses would create cookies for each user and keep users’ records so that ad companies could utilize the cookies and send Internet users advertisements, which would have higher probability of influencing users. This way is much better than the old fashion television way of doing advertisements.

In order to change the situation, television ad pricing model should be adjusted go beyond the ratings, and stickiness, that TV networks currently measure, and beyond the easy-to-measure data that Facebook collects. The TV industry will need to invest in the type of creative evaluation testing that big marketers use to test their ads, or at the very least, it should review these scores from a third party, like Millward Brown for example, in order to provide a discount to ads that score well.

Source: http://adage.com/article/digitalnext/wake-call-facebook-tv-ad-pricing-change/297348/