When you consider e-commerce, you will find that there are lots of different models of business used for this purpose. Each model has a different purpose, significance, usage, and benefit. Typically and in keeping with the literal meaning of e-commerce, all these business models perform business transactions that are primarily conducted online.
The most popular example of an e-commerce business model is online shopping. This typically defines buying and selling of goods or services through the internet using any type of device. However, the good thing about e-commerce is that it can be used for different other types of activities as well. These types of diverse activities involve:
Payment gateways and
Ideally, e-commerce is perhaps the fastest-growing retail market. According to a few specific research reports, the sale of e-commerce products and service is estimated to hit nearly $4.135 trillion in 2020.
Mobile commerce, which is also called the m-commerce, is another fast-growing new avenue of e-commerce. This is actually the result of the rapidly expanding market of smartphones and its influence on the day to day lives and activities of the common people. It typically provides the maximum comfort to the users while shopping online.
Different e-commerce business models
In 2018, reports say that the e-commerce sector experienced an increase of 39.1% in sales as compared to the sales figures of 2017.
It is all due to the most useful and effective e-commerce business models. Typically, there are three different business models in which e-commerce can be classified. These business models are typically based on the type of participants or users involved in a specific transaction. In the broader sense, these special types of business models include:
The business to business or B2B model: This model involves sales that are made from one business to the other. In this model, the type of products sold typically involves stationery items by one store to another. It may include office equipment sold in bulk to another business or businesses. Usually, all B2B companies provide these products at a much-discounted rate for each unit as things are bought usually in bulk. It is a great model that provides a lot of motivation for the seller as well as the buyer.
The business to consumer or B2C model: In this specific e-commerce business model which is also the most commonly practiced and thought of business model a business sells products or services to a consumer directly. Typically, as individuals are involved in such purchases most of the times, the volume of purchase of each transaction is much less as compared to the business to business model of e-commerce. The most common example of a B2C model of e-commerce is consumers buying products in a supermarket where there are no bulk purchases made even if the products are bought on a weekly basis.
The consumer to consumer or C2C model: This is comparatively a much newer e-commerce business model where consumers sell one item that they may have bought previously to another consumer. These sales are usually made through dedicated e-commerce channels that act as a marketplace. A few popular and mostly used marketplaces are namely eBay and Craigslist. This business model is very popular to those people who want to sell a product that they no longer have any use for. These marketplaces act as a useful platform for them and prove to be the most lucrative and easiest way to sell their items in a hassle-free manner.
Therefore, if you are contemplating of starting an e-commerce business, then there are a number of ways to do it and go ahead. All you need is to find the different types of products that you can start selling online. In most of these e-commerce sales, there is no commitment or credit card required.
The benefits of e-commerce
There are a lot of reasons why you will find most of the businesses have gone online. In this day and age you will not only find a lot of stores on the online marketing platform selling products ranging from fashion items to daily grocery needs, airline tickets to food items from different restaurants, you will also find several online sites such as www.libertylending.com and others that provide easier and faster access to loans and other financial products as well.
What does it signify? It means that e-commerce business is not only convenient for the consumers but is also extremely beneficial for the sellers. This is the reason why e-commerce has shown such explosive growth in just a couple of years past.
The most notable benefits of e-commerce include:
It helps the stores to reach to a global market easily and caters to the needs of a global audience which is not possible for a physical store due to the restraints of the geo limits. The most significant factor is that there is no additional cost required by any business to go from local to global.
Another significant advantage of e-commerce is around-the-clock availability. All online stores are always open. If you consider the point of view of the merchants it provides them with a much better opportunity to increase their sales prospects dramatically. On the other hand, if you consider the perspective of any consumer, they can conveniently and immediately get access to their desired product any time of the day and might and literally from any corner of the world. That means the consumers are served by an e-commerce store for unrestricted working hours for 24/7/365.
Reduction in cost of operations is another significant advantage of e-commerce businesses. This is because there is no need to hire any sales staff to make a sale or there is even no need to rent or buy a physical storefront. The major cost of e-commerce is in warehousing and product storage. However, if you are into dropshipping business then you will even much lower upfront investments.
Ecommerce business also helps in inventory management, targeted marketing and to service niche markets.
Isabella Rossellini is a marketing and communication expert. She also serves as a content developer with many years of experience. She has previously covered an extensive range of topics in her posts, including business and start-ups.