PayPal Case analysis
“PayPal 2015: Reshaping the financial service landscape” provides the attempt by PayPal to transform the payment system in diverse parts of the globe. PayPal has made some serious increases in e-commerce, the purchasing power has been raised. The company was found in 1998, and this was endorsed to the growing market size and the demand to go online in paying and purchasing goods and services. In 2015, PayPal mainly started to show efficiency in the market when it transformed the payment methods, payment processing, digital wallets, and features of money transfer.
Firstly, the main issue for PayPal was started from the concern to money transfer. This was evidenced by the case of NASDAQ stock exchange in 2015 after the company's CEO- Dan Schulman adopted the PayPal payment system. It is noted that PayPal provided a global opportunity for customers as transactions were conducted via smartphones. In addition to this, loading was made efficient, and it became very easy to determine aspects of concern to credit worthiness.
At the time PayPal was under eBay’s roof, this was truly profitable for both sides. However, after the separation, the two companies has observed declines in their profits. PayPal shares in eBay deteriorated significantly. Despite that fact that PayPal has been facing some critical challenges concerning profitability, merging, partnership and leadership, this company has made some significant leaps in dominating the payment system in the global market.
With current 20,000 employees, PayPal is a succeeding company at a largescale. The adoption of an internal consensus within the enterprise was the key factor which has attributed to this growth. The acquisition of Braintree has created positive outcomes.
Provision of adequate customer services, improvement in the organizational structure, development of new products, development of new markets as well as a development of advanced and efficient technology have supported PayPal’s market share increase.
To follow a better firm strategy, the executives should focus on reducing the overall cost of transaction since there are arguments about the system is being expensive. Further the administration should pursue a global expansion strategy for the company to focus not only on the developed but also on the developing countries. Due to demographics, the use of online strategy for PayPal has been unproductive. Establishing generally on the developed countries has worked against PayPal and thus a global market has not been accomplished. PayPal needs to extend its services to other businesses, create an effective business strategy, adopted practical leadership aspects, enhance its online security and lower the overall cost of transactions.
Thus, PayPal is facing some critical competition from other companies such as Amazon, Snap deal, And Flipkart. In China because of its establishment within the country, the company has not been able to succeed. New entrants are emerging in the payment system and as such, the company has not been able to achieve its sought objectives of becoming a business leader in the payment system.
PayPal’s ease of use in aspects of opening accounts and acceptability by large companies strengthen the company, however risks related to being subjected to fraud and nonrefundable transactions, funds withdrawn from PayPal cannot be recovered, are considered as weaknesses.
More and more people accept payments through mobile and text messages.
Opportunities.
Threats.
Due to increased aspects of competition, PayPal should consider possible partnerships. Such as the initial partnership between eBay and PayPal. During that time, PayPal had high profits. Also, the executives should adopt new ways of getting customers, advance their technologies and focus on both the old and the young generations. In an attempt to enhance security, PayPal should adopt effective technological means, secure security software and provide its employees with the necessary training concerning honesty. Further, the company should offer incentives to its employees and hence, employee retention will be achieved.