Better, Simpler Strategy

5

Hiding in Plain Sight

Near-Customers

In the early 2000s, Meg Whitman, CEO of eBay, was thrilled about her company’s prospects in the burgeoning Chinese market: “We think China has tremendous long-term potential and we want to do everything we can to maintain our No. 1 position.… Ten to 15 years from now, China can be eBay’s largest market on a global basis.”1 Whitman’s enthusiasm was not difficult to understand. In 2002, eBay had entered China by investing US$30 million in a local company called EachNet, a Chinese C2C marketplace founded by two HBS graduates: Tan Haiyin and Shao Yibo. A year later, eBay acquired EachNet outright. The company’s future seemed exceptionally bright; it commanded an 85 percent market share, and 62 percent of its ...