Ebay has launched its bid to buy a 37% share of the Korean auctioning site Gmarket from Interpark. As the major players in the online market space broaden their international reach, there are significant market differences that need to be taken into consideration. Certainly the similarities between consumer online behaviours in the USA and Europe outweigh their differences, but the further east companies look, the further they will have to shift their core value proposition to meet the markets needs. Integration of Asian online companies is notoriously difficult. Take for example buying an airline ticket. In China it is expected that you buy your ticket online and the ticket is delivered to your door, once delivered you pay the delivery person in cash for the ticket. Such a ‘high touch’ value proposition wouldn’t stand the cost benefit analysis of European organisations. Therefore deals such as Ebay and Gmarket have a hidden element which needs to be taken into consideration: Integrate and shift the buyers core value proposition, or segment and miss out on the economies of scale.
Source: Abdelaziz (Aziz) Musa