Since 1984, the world e-commerce market has grown to a net worth of $27 trillion – but what is e-commerce? Things have come a long way since one man sold his friend a CD online, there are well over 10 million e-commerce sites and online marketplaces like eBay and Amazon. If you’ve ever found yourself considering e-commerce, you can find out more about what eCommerce is and different types of e-commerce.
What is e-commerce – definition
E-commerce, also known as electronic commerce, refers to the practice of selling products and services through the internet. This can be anything from online fashion retailers to video learning courses. Done well, ecommerce can be a lucrative revenue stream for businesses, particularly those looking to further their brick-and-mortar presence.
What are the 3 types of e-commerce?
Depending on the e-commerce definition you look at, there could be three or four different types of e-commerce. The three core types include:
- Business to consumer (B2C)
- Business to business (B2B)
- Consumer to consumer (C2C)
There is a fourth type, consumer to business – less common but no less valuable. This is when customers sell something that may be of value to a business, for example, personal data to a marketing company.
But what about the other three types of ecommerce?
What is B2C e-commerce?
Business to consumer commerce is probably the one you’re most familiar with – selling consumer products online such as fashion or gadgets. Sales to consumers are likely to be lower value items but with a high volume of orders. Retailers may sell on their site directly, or through a marketplace such as Amazon.
What is B2B e-commerce?
Business to business sales tend to be higher in value but may require more marketing or a longer sales funnel. Businesses need more convincing that a product is worth their while. The benefit of B2B sales is that you are likely to form long-term relationships with lucrative spends.
What is C2C commerce?
Consumer to consumer commerce uses a marketplace such as eBay, which allows consumers to sell their wares online to other consumers. It can be more cost-effective for consumers, particularly those who want a quick sale – for example, selling a car on Facebook Marketplace.
Is it easy to set up an e-commerce business?
If you run a small business, you can benefit from adding an extra revenue stream that is simple to set up. There’s also some awesome benefits of e-commerce to small business.
Setting up should be easy and you’ll likely be able to attach an online shop to your existing websites with the help of web designer or developer. If you’ve not got a website, you’ll probably want to know how much an e-commerce website costs!
When setting up an e-commerce business, you will need:
- Full product details including SKU numbers where appropriate
- Photographs of the products/description of the services
- A CMS (Content Management System) to manage your inventory
- An account with and connection to a payment gateway like PayPal or Stripe
- An SSL certificate for customer security
- Access to couriers for the delivery of physical products and where will you deliver to? Remember some areas of the UK cost more to ship to
- Pricing structure – What are your competitors charging? How will you account for selling larger or heavier items? Will you offer free delivery? Or click-and-collect?
This may sound daunting at first, but when you’ve got these provisions in place, you could make passive income 365 days a year.
Best of all, e-commerce opens doors to many other selling channels – from Google Shopping to online marketplaces and social media channels such as Facebook .
We hope you’ve found this article informative but if you have any further questions, please contact us
