Ecommerce Domain Fundamentals

Ecommerce Domain Fundamentals, Types of Ecommerce, Business to Consumer, Business to Consumer, Consumer to Business, and Consumer to Consumer.

Ecommerce Domain Knowledge for Software Professionals

1. Introduction

Ecommerce – Electronic commerce is buying and selling goods or services through the internet.

More products are bought and sold online every day. It started with books in the 1990s and it has moved to almost every market and sector of industry.

Ecommerce is the fastest-growing area of business, The Internet, user-friendly websites, secure online payments, broadband, computers, smartphones, and tablets have arrived and now more people are choosing to ‘shop online’.

Ecommerce offers many benefits over traditional retail, including exposure to new geographical and international markets, and a streamlined buyer-to-seller relationship.

2. Types of Ecommerce

We have four types of Ecommerce Business Models.

i. B2C – Business to Consumer.

The B2C model is the most common business model in which the exchange of goods or services over the internet between online stores and individual customers.

ii. B2B – Business to Consumer.

In a B2B business model, a business sells its product or service to another business. Sometimes the buyer is the end-user, but often the buyer resells to the consumer.

iii. C2B – Consumer to Business.

C2B businesses allow individuals to sell goods and services to companies.

In this eCommerce model, a site might allow customers to post the work they want to be completed and have businesses bid for the opportunity.

iv. C2C – Consumer to Consumer.

A C2C business — also called an online marketplace — connects consumers to exchange goods and services and typically make their money by charging transaction or listing fees.

Example: Quickr, OLX, etc,


i. G2C – Government-to-Consumer

Ex: A telecommunications company provides government-subsidized mobile networking services.

ii. G2B – Government-to-Business

G2B is online commercial interaction between governmental and private corporations. An example is a government website where businesses go to pay taxes.

3. Advantages of Electronic Commerce over Traditional Commerce

The advantages of electronic commerce over traditional commerce are as follows:

i. Instant worldwide availability.

ii. A streamlined buyer-to-seller relationship.

iii. Reduced paperwork.

iv. Reduced errors.

v. Time and overhead costs.

vi. Reduced time to complete transactions.

vii. Easier entry into new markets.

viii. New business opportunities.

ix. Improved market analysis.

x. Wider access to assistance and advice.

xi. Improved product analysis.

xii. The ability to streamline and automate purchasing.

Possible drawbacks of Electronic Commerce?

Increased vulnerability to fraud; difficulty protecting intellectual property; risks to confidentiality; problems over taxation; customs requirements; regulations; credit card fraud; security; trust problems, and constant availability.

4. Business-to-Consumer (B2C) Model

• In the B2C model, a business website is a place where all the transactions take place directly between a business organization and a consumer.

• Businesses sell goods straight to consumers through their website.

• The internet serves as a marketplace in itself and the eCommerce store serves as the portal between businesses and consumer shopping online.

• Online stores are able to list multiple products which gives customers many options to pick and choose from during their buying experience.

• Online stores allow for more options for a customer to research and find the perfect fit. Clothing, electronics, and outdoor recreational equipment are just a few of the products that effectively sold online in B2C.

• The B2C transactions are not limited to products, services also are quite often distributed in this fashion as well.

• Businesses may offer services like financial advising, tutoring, subscription memberships, and others to grow their presence online.

5. Business-to-Business (B2B) Model

• Business-to-business (B2B) is a transaction or business conducted between one business and another, such as a wholesaler and retailer.

• B2B transactions tend to happen in the supply chain, where one company will purchase raw materials from another to be used in the manufacturing process.

• B2B transactions can include bulk pricing, larger quantity orders, or specialty products that an average consumer would never need on a day-to-day basis.

• Typical products that are involved in B2B transactions include office supplies, gasoline and oil, medical equipment, airplanes, ships, and military equipment.

• B2B transactions are also commonplace for auto industry companies, as well as property management, housekeeping, and industrial cleanup companies.

• B2B transactions occur in many forms and take place globally.

6. Consumer-to-Consumer (C2C) Model

• In the C2C model, the platform itself does not own or sell any products. rather, it serves as the bridge between consumer selling and consumer buying.

• This bridge (C2C) allows men and women to sell goods without setting up a personalized store. This results in fast and easy individual transactions allowing for niche items used goods, and individual listings to be sold online.

• The internet itself is a powerful marketplace in and of itself. Other marketplaces have come to fruition to offer consumers shopping options.

• Platforms like eBay, Craigslist, Grailed, and even parts of Amazon allow consumers to sell to consumers.

• Selling an item on C2C sites can be as simple as opening the app or site, creating an account, listing the item, and waiting for another consumer to purchase.

• C2C model is becoming increasingly prominent with the inception of different marketplaces looking to gain a share of the market opportunity.

• C2C opportunities increase consumer buying power by eliminating many steps of the buying process.

7. Consumer-to-Business (C2B) Model

• The C2B model allows businesses to receive value from consumers.

• Consumers are able to provide a service to businesses to augment their existing business through a reverse auction system.

• Consumers can act like contractors bidding on certain projects which allows them to bring value back to the business.

• In the C2B model, the consumer is setting the price and has leverage over the transaction since they are providing the service.

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