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Ebay Seems To Have A Technical Platform In Place That Is Flexible And Shows ...

EBay seems to have a technical platform in place that is flexible and shows high degrees of scalability. And this can certainly be said for the company's processes and procedures, or in other words, its business model.
QXL Ricardo plc

History

The company was founded in 1997, i.e. two years after eBay. It signed a partnership with AOL in 1998 and renamed itself QXL (previously: Quixell) to reflect the imminent European expansion more adequately. It opened a German and a French site in 1998 and 1999, respectively. Apax took part in another financing round, and a private placement yielded further proceeds of GBP 20.65mn. In that year it was floated on the Nasdaq and the LSE, and QXL.nl was opened. QXL acquired a company in Norway.

In the year 2000 the company opened a site in Spain and acquired a Polish and a Swedish company. It co-branded a credit card and continued auctioned airline seats on its website. This marked a crucial feature of the company's business model: It was not purely based on C2C, but it also did B2C business.
The company continued to sign business partners such as Thomas Cook, Lufthansa, Virgin Holidays etc to use its platform as alternative channels of distribution throughout 2001. It launched an integrated marketing campaign with Coca Cola whereby consumers of the drink could bid for items on a special website. It was also in 2001 that the company changed its model from principal to agent-based, i.e. from now on QXL did not sell goods on its own account any more, but it generated revenues through fees (like eBay).
In 2002 the co-branding efforts were stepped up again, and in 2003 the company delisted its shares from the Nasdaq so as to avoid the stringent reporting requirements. At that stage only a few local markets of the group had achieved profitability. A further acquisition was followed by increased efforts of co-branding, among others with Yahoo! in Scandinavia. Marketing expenses were reduced again and the numerous technology platforms in the group were restructured.
In 2005 the company achieved an increase in sales again, but it remained negative on the bottom line.

Evaluation

Like eBay, QLX seems to have realised that it was crucial to achieve a critical mass.

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