E-commerce is commonly known as electronic commerce or internet commerce. It refers to the sale of any physical items or products online and it also refers to the buying and selling of any goods or services using the internet. E-commerce is an online transaction between a supplier and the consumer.
Types of E-commerce Models:
4 main types of e-commerce models which describe almost every transaction that takes place between consumers and businesses.
1. B2C (Business to Consumer):
B2C (business-to-consumer) is the type of commerce transaction in which the businesses sell services and products or goods to the consumers.
Traditionally, this could refer to the individual’s diners eating in a restaurant, shopping for clothes for themselves at the mall, or subscribing to pay-per-view TV at home.
The term B2C also means to the online selling of services or products, or the e-retailing in which the manufacturers, Wholesalers or retailers sell their products to consumers over the Internet. There are many virtual stores and malls on the internet, which are selling all kinds of products such as Books, clothes, shoes, foods, software, computers.
Generally, B2C E-commerce Web Shops have 24 hours open access to all the consumer or the end user. With the more usage of the internet, B2C eCommerce model has evolved to a great extent. we have found very high scores of electronic shopping sites and virtual stores on the web which sells all categories of products. Sometimes Vendors may have to face security issues in e-commerce website with regards to payment or seller panel dashboard of marketplace.
2. B2B (Business to Business):
It simply means “Business to Business” which refers to any Organization primarily focused on the selling products and services to other businesses rather than directly to the consumers. B2B companies or Organization can be found in every industry from manufacturing to retail. They are not engaged directly with sales to the consumer public.
3. C2C (Consumer to Consumer):
Consumer to Consumer or C2C is the business model that facilitates commerce between any individuals, Whether it is for products or the services.
This model of e-commerce connects people to do business with one another. It is also the best platform which enables consumers to sell to other consumers.
4. C2B (Consumer to Business):
The Consumer-to-Business C2B model allows businesses to extract value from the consumers and vice versa. In C2B e-commerce model, The Businesses profit from the willingness of the consumers to name their own prices or contribute the data or marketing to the company, while the consumers profit from the direct payment, flexibility or free or also with the reduced-price services and products.
Examples of Ecommerce:
The sale of any products or goods in the bulk directly to the consumer. Wholesalers mainly focus on managing manufacturing part, maintaining active inventory and getting products to the specific location quickly and efficiently.
The Retail term refers to the sales of a product by any business directly to the customer without any intermediary
A retail transaction is meant to handle the small quantities of products whereas the wholesale is meant to deal with the purchasing of products or goods with large units.
Retail transactions are not to be confused with online transactions. In Retail, any Product or goods must be sold from a single point directly to the consumer for their end users.
The sale of a Goods or product, which is manufactured by the product developer and shipped directly to the consumer by a third party.
Dropshipping is the best retail fulfillment method where a store doesn’t keep the products or goods it sells in stock. Instead, when a store sells the product from the inventory, it purchases the product from a third party provider and then shipped directly to the end customer. As a result, the merchant who makes the product never handles the shipping of the product to the end user.
4. Physical products:
Physical Products means Products which can be touched or tangible and build with some materials and which has weight, height and the dimension and can be shipped to the consumer after the sale. Any kind of goods or products that requires inventory to be replenished and the orders which are to be physically shipped to the end customers the sales are made.
5. Digital products:
The Digital or Virtual Products are the products which can be used, downloaded or subscribed immediately after the purchase and payment.
These Products are Downloadable digital goods, templates, and courses, or media that must be purchased for consumption or licensed for use.
Services are the non-physical, intangible parts of the economy, as opposed to goods or products, which we can touch or ship. A skill or set of skills which is provided in exchange for compensation. The service provider’s time can be purchased for a fee.
The collection of money from the consumers in advance of the product or Goods being available in order to raise the startup capital which is required to bring it to market.
It combines the best of micro-financing and crowdsourcing, bringing together different individuals who commit money to the projects and the organization they want to support.
The automatic recurring purchase of the products or goods and services on a regular basis until the subscriber end user chooses it to cancel.
Advantages of E-commerce:
1. Generates 24/7 Potential Income:
One of the advantages of e-commerce is that online stores are always open for the business. With the Facebook ads, Instagram ads, Google ads you can attract anyone at 12 p.m. or 3 a.m. to purchase your product.
Many of the physical location stores are open between 10 a.m. to 9 p.m i.e scheduled time and the consumer is not able to purchase after the store is closed.
By being available 24×7 hours, you can attract peoples who would normally pick up a product in stores, if the store were open.
With the Online Store, You can also attract those peoples who may have odd work schedules or those who don’t have time to shop in-person.
For any customer who wants to order some item at the night time, you don’t need to have employees working in the night shift to ensure all orders get processed. You will never need to hire an employee or a security guard.
2. It can start with Low Financial Cost
One of the best e-commerce benefits can be found is that it has a lower startup cost. Physical retail stores have to pay lots of money to rent one of their store locations or to buy the location. Also, they have several upfront costs like buying inventory, store design, store signs, sales equipment, software and more.
Physical retail stores also have to pay their employees to work and run each location. They also need to hire the security staff depending on the product value in their store. Your business expenses are very much low in the e-commerce model.
3. You can Sell items Internationally
Another e-commerce benefit is that a new product or the brand can be sold to any customers around the world very easily.
You just have the ability to better understand your target audience for your product or service whether they are in the U.S, U.K, Europe, or in any part of the world.
If you choose to dropship the products from AliExpress, many products which are offered at affordable ePacket shipping or with free shipping. This allows you to price and ship your items competitively to a worldwide audience and thus generate more sales.
4. It Can Grow Business Organically with the Good Content:
With e-commerce store online, you can increase the organic traffic and sales with e-commerce blogging with the best content. From making videos to writing the good blog content topics, you will be able to optimize your store to drive relevant traffic and thus generate sales without having to spend more money on Google Ads, Facebook Ads, Instagram Ads.
A retailer would need to market their products or items to their customers to encourage visits or ensure they are located in a high traffic area to get more shoppers which then purchase products from them.
But With the e-commerce business, you will be able to not only get good traffic organically through content creation, you will be able to monetize those customers with creating retargeting ads campaign.
5. It Can Scale the Business Quickly:
One of the benefits of e-commerce model is that it is very easy to scale the business very rapidly. You can increase your ad spend budget when ads are running well and showing good result without having to worry too much about keeping up with the demand, especially when you are dropshipping.
With brick and mortar stores, In case if your store needs to grow in the space to accommodate new products or add more cashiers. You’ll need to find a bigger space in which you can store all the stocks, renovate and wait for your lease to end.
This will delay your ability to scale and thus takes a lot of time to do many tasks.
If you are creating informational products, you run into a challenge again as it will also take time to write courses, ebooks, and more. With the dropshipping model, you can add new products or items anytime to your online store without having to worry about shipping items or holding the inventory items allowing you to grow quickly. The sudden increase in online sales is only becuase of the impact of e commerce that has driven apart.