An Investigation on how to provide Consumer Protection on eBay

Research Proposal




The online auction website known as eBay was founded back in the year 1995. Its founder was a computer programmer living in California known as Pierre Omidyar.  On 1996, the website managed to hire its first employee. On the same year, eBay entered into a licensing deal with a company known as Electronic travel action. The main objective of the deal was to sell plane tickets. The website also managed to sell other travel products through the deal. By year 2007 January, the website managed to host more than two million auctions.

Comparing to the previous year where it managed to hold only 250,000 auctions, it was a significance achievement. By December of 2007, the website changed the name of its service. The website was named eBay after changing its old name, AuctionWeb.  Moreover, the company also managed to receive $6.7 from Benchmark Capital. On 1998, it had thirty permanent employees in America. On March of the same year, eBay had more than 500,000 users. By the end of 1998, the company managed to make an outstanding target share of $53.50. By February 2002, eBay achieved one of its targets by purchasing IBAZAR. On October of the same year, the company bought PayPal.


A stock market refers to a public entity where trading regarding shares of a certain company is made upon an agreed price. The other name for a stock market is equity market, meaning that the market allows free network of various transactions (Zuravicky 6). Stock exchange takes place through a stock market. The main aim for establishing stock exchange is to enhance effective securities exchange. These activities contribute to the existence of a stock market that caters for all the market requirements. The actual trades in a stock market are based on an auction market model.  This means that a certain buyer from any geographical location bids price for a stock and waits for a seller. The seller, who emerges, bids the price for the same stock. The trade takes place if the bid asks for prices meet. Moreover, if there are a number of bidders and askers in the same time, the first ones get the first priority.


Market crash refers to rapid and sudden drop in stock prices where most of the traders are caught off-guard, meaning that they were not expecting of such a fall in stock prices. Some of the consequences associated with a market crash include economic crisis. In most cases, a recession or a depression tends to occur after a market crash (Buehler & Kacy 41).


Financial crisis refers to a situation where various financial institutions tend to lose their value by a great extent. Financial crisis leads to a significant loss of paper wealth in most of the institutions. However, in case of a recession or a depression, financial crisis tends to cause changes in the real economy. This contributes to unemployment and various financial difficulties among citizens.


Some of the emerging markets tends to experience or may be had experienced financial crises. Various fundamentals assist in explaining whether a certain country has high chances of experiencing financial crisis. One of these fundamentals is a high real exchange rate appreciation. The other fundamental is a recent lending boom.  The third and final fundamental is low reserves.  Through analyzing the three fundamentals, it is possible to explain why some countries experience financial crisis while other does not.


Efficiency of financial markets means that investors put their money in a stock market with aim of making profitable returns. Efficiency means that the investors have a significant opportunity of making good money and helping to outperform others in the market (Chatterjee 201). Efficiency tends to be un-predictable. Moreover, efficiency is not limited to various financial news and research work. Prices in an efficient market are not predictable. However, the prices tend to be random and therefore no investment pattern that can be discerned. However, there are some challenges that tend to hinder efficiency in stock markets. For example, some of the investors tend to buy undervalued stock and then sell overvalued stock. Because a stock market tends to have many participants, this leads to inefficiency.


The aim of this paper is to discuss various ways on how to provide consumer protection at eBay. In most cases, sale by auctions are excluded from the scope of distance selling. This Consumer Protection Regulation was enacted back in 2000. The paper uncovers various difficulties that eBay auctions encounter while trying to get protection. The paper concludes by stating the proposed legal classifications that ought to be employed in order to help eBay auctions get the best protection. The main aims and objectives in this paper are

  1. To determine various rules and regulations enacted to provide consumer protection at eBay
  2. To figure out what is the possible solutions for the problems that affect consumer protection
  3. To recommend various solutions that will assist in enhancing effective eBay consumer protection


The following research questions tend to offer significance guidance in this paper on how to reflect the issue of consumer protection at eBay and develop reliable and effective solutions.

  1. Why do eBay require consumer protection
  2. What are the most significant aspects to consider as the first priority in providing consumer protection at eBay
  3. What are the best steps to take in order to curb any practice that might appear and hinders implementations of consumer protection at eBay


One of the main advantages associated with eBay is that there has been an immense success in most of its operations. Many investors establish eBay auction because it has a clear popularity with the public. However, risks that tend to affect most of the consumer mars the success that eBay auction experience.

Some of the risks that affects eBay auction include state and value of items being sold. In some cases, some items fail to correspond with their description. Various cases of fake goods have been established several times and this makes it necessary to have a means of providing protection to consumers. Moreover, various incidences of fraud have been indentified within the company. Rafael (168) indicates that the Internet Fraud officials managed to figure out that they were various complaints of consumers regarding goods not delivered. The complaints managed to cause an average loss of $1,155 (Rafael 168).

One of the best to ensure that there is reliable consumer protection at eBay is to provide sound advice to all customers. This will help in making sure that consumers are equipped with the necessary knowledge on how to stay safe.  Another best step that eBay ought to take is to set an enforcement team that will manage to handle all complains from consumer. This will help in detecting various faults that might emerge in future. Moreover, eBay have an obligation of involving the government on issues regarding consumer protection. This will help in trying all those caught abusing various auction rules and regulations. Another significant aspect that eBay ought to consider is encouraging other online businesses to share information about those breaking the law keeping consumers at risk (Great Britain 53).


The area that I intended to cover on this research is on how eBay will manage to provide consumer protection through enacting effective measures. On this research, I will manage to employ both primary and secondary data collection that will assist in analyzing on impact of failing to provide customer protection at eBay. Another significant issue to note is that one method of data collection may fail to provide the intended conclusive results and therefore it will be the best option employing both methods in order to complement one another. In order to get the intended results from a wider community of investors who are supposed to respond on this research, I will manage to employ a set of administered questionnaire. I will also conduct various interviews on a number of investors in order to get the recommended information.


In order to make sure that the study meets the targeted goal, I will collect secondary data from various sources such as magazines and journals related to the company (Wrenn Stevens & Loudon 73). I will focus mostly on the issues that consumers view as the ones seems to be risky when carry out business with the company. Moreover, I will also manage to focus my attention on interviewing a number of investors from the company. Moreover, I will also interview investors from other auction companies in order to get all the necessary information that will assist in this study. Apart from investors, I will also conduct interviews on various government officials in order to see how they can manage to help on the possibility of curbing vices related to online services (Luton 27).


One of the methods to rely on during the study is data collection. Data collection refers to the process of gathering the necessary information related to this study (Jupp 95). In order to obtain conclusive outcomes during the study, I will manage to send questioners to all investors in various institutions so that they can be able to contribute towards the report. During the final stage of the study, I will manage to make a comprehensive report on all the data and make it easy for everyone to understand.


Ethical considerations relates to various issues and questions that requires extensive care when addressing them in order to conduct the study in morally and appropriate manner. I will make sure that I address all-ethical related issues when making the study so that to gain only the useful and reliable results. The other issue to consider related to ethical consideration is social values. Failure to address all the ethical issues, the whole study may lack professionalism (Daymon &Holloway 56).


The main aim of conducting this particular research will be identifying various ways in which eBay will manage to provide consumer protection in future. Through the study, eBay will be able to regain its trust from all the potential customers. This will become possible after illustrating to them how the company will manage to protect their resources.


Submission of the proposal—————————————-1st March 2012

Preparation of survey questions———————————4thnd March 2012

Collection of Secondary data————————————   7th March 2012

Analysis and reporting of the findings of secondary data—-18th March 2012

Submit the final report ——————————————–20th March 2012
















Works Cited

Top of Form

Buehler, Stephanie & Kacy Kohut. Stock Market Simulations. Westminster, CA: Teacher   Created Materials, Inc, 2000. Print.

Chatterjee, Arnab. Econophysics of Stock and Other Markets: Proceedings of the Econophys-        Kolkata Ii. Milan: Springer, 2006. Print.

Daymon Christine & Holloway Immy . Qualitative Research Methods in Public Relations and       Marketing Communications. New York: Taylor & Francis, 2010

Great Britain. A Better Deal for Consumers: Delivering Real Help Now and Change for the           Future. London: HM Government, 2009. Print.

Jupp, Victor, and Roger Sapsford. Data Collection and Analysis. London: SAGE, 2006. Print.

Luton, Larry. Qualitative Research Approaches for Public Administration. Armonk, N.Y: M.E.     Sharpe, 2010. Print.

Riefa, C. (2008). “To Be or Not to Be an Auctioneer?” Some Thoughts on the Legal Nature of     Online “eBay” Auctions and the Protection of Consumers. Journal Of Consumer Policy, 31(2), 167-194.

Wrenn Bruce, Stevens Robert & Loudon David. Marketing research: text and cases. London:       Routledge, 2006. Print. Bottom of Form

Zuravicky, Orli. The Stock Market: Understanding and Applying Ratios, Decimals, Fractions,       and Percentages. New York: PowerKids Press, 2005. Print.

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