Types of e-commerce
When we think of e-commerce, then we automatically think of an online website which allows online payments to be accepted for goods or a service between the supplier and customer. Now this maybe a quick way to summarise e-commerce yet what you probably did not realise yet is that electronic commerce goes much further and can even go as far and divide into six types of e-commerce which we have outlined below.
- Business to Consumer
- Business to Business
- Consumer to Consumer
- Consumer to Business
- Business to Administration
- Consumer to Administration
Business to consumer or as it is commonly referred to as B2C is by far one of the most popular and traditional types of e-commerce. Business to consumer e-commerce involves a direct sale between the company and the customer.
This type of e-commerce involves building a relationship with the customer in the aim to have the customer return and purchase more products or services in the future. This type of commerce can in some cases allow more flexibility with discounts to entice the consumer to buy or buy more.
Business to consumer commerce can sell literally anything that a consumer will need or use once delivered either digitally or physically.
This type of e-commerce has grown massively in the last 15 years with companies such as Amazon who offer a vast range of physical and digital products to their customers.
Due to the nature of the online business to consumer model, products and services can be discounted far more than traditional high street stores, as overheads are much lower. Thus making this type of e-commerce a more popular choice for new businesses who wish to test their products on the market first or businesses who have a small budget to start with.
Typically Business-to-Business e-commerce involves of all online transactions of goods or services to be conducted between businesses/companies and not available for the general consumer to access and purchase.
In traditional business, this can be seen as a wholesaler who would, therefore, sell in bulk at a discount.
Yet over the last couple of years websites such as Alibaba offer wholesale/bulk buying online to the end consumer to which opens the doors to drop shipping.
Consumer to consumer e-commerce is where a transaction takes place between consumers for goods or services and a third party conducts the transaction and provides the online service where the communication and transactions between the consumers can be carried out.
The online auction website Ebay is one of the most perfect examples of this type of e-commerce and really has utilised this type of commerce to its full potential. Another more recent example would be Gumtree.
Consumer to Business
For many of us, the consumer to business type of e-commerce may be unheard of yet it actually does exist, and when I provide you with an example of this then you really will perform an epic face palm!
Consumer to business reverses the traditional method of exchanging goods and services. It is where consumers (usually a large number of customers) will allow their products (in most cases digital products) to be available for purchase on a website that other consumers or companies are searching for.
A shining example of the consumer to business type of e-commerce would be stock photography websites such as istockphoto, Stockphoto and Shutterstock which sell a broad range of royalty-free photographs and illustrations which vary in price dependent on the quality of image required for the end user.
When we think business to administration e-commerce, then we think of areas that include social security, registrars and employment to name but a few. This type of e-commerce is where transactions are taken place between companies and government or public administrations.
With administration realising that having an online payment system in place they can highly leverage staff time on processing payments in-house and therefore this type ofe-commerce has seen a massive increase in recent years.
Very similar to the business to administration e-commerce model, the consumer to administration type allows payments to be transitioned between customers and administrations such as governments.
Examples of this type of e-commerce would be taxes, social security, visa and passport services to name but a few.
If you have any more questions in regards to the different types of e-commerce or if you are clear on what types of e-commerce your business is going to implement then contact our team by clicking here.