E-commerce is fast on the rise as a viable business model. Here are its basics.
Mid a world of buying and selling, e-commerce is ever-rising as a successful business model. In the first quarter of 2018, e-commerce sales were over 9% of total retail sales. It is expected to rise to 14% of total sales by 2021. What really is e-commerce, anyway? There’s more to it than meets the eye.
What Is E-Commerce?
E-commerce is short for “electronic commerce.” Whether based on a brick-and-mortar store, or depending solely on a website for a storefront, businesses can make and accept electronic transactions through a series of simple clicks. Of course, this method of making purchases is so common now that its process needs little explanation, considering the major role that Amazon and others play in the market. For entrepreneurs and businesses, however, this is a set-up that can accomplish specific goals. For example, their market can reach a targeted audience around the globe, 24/7. It may also be less of a cost than establishing a physical storefront.
Types of E-Commerce
In light of these goals, there are several types, or subsets, of e-commerce. There are three main types: business to consumer (B2C), business to business (B2B), and consumer to consumer (C2C).
The business to consumer model is the one we are most familiar with. The business owner must set up a payment method on their website so that consumers can safely make purchases through their credit, debit, or gift card. With several clicks, business is swift and efficient. Subsets of this model include f-commerce (Facebook commerce) and m-commerce (mobile commerce).
Business to business commerce works on a bigger scale of transactions. A good example is that of a car repair shop ordering auto parts from a manufacturer. While people once ordered beforehand in bulk, orders are now automated to restock every time the inventory reaches a minimum supply level.
Consumer to consumer, meanwhile, is the online version of the auction. eBay is a good example of this, in which consumers bid to attain a product.
The Whole Gamut
The base and types of e-commerce only scratch the surface when it comes to this type of business. While many think that e-commerce is all about procuring or creating products and selling them, there is so much more that goes into an online store. E-commerce is the whole gamut: creation, graphic design, marketing, customer service, packaging, shipping, and more.
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