Internet and modernization have massively changed the way people shop for products or services. Unlike in the past where you needed to physically visit a retail store, you can now simply make purchases online. The availability of smartphones and computers have made it easier for people to shop from the comfort of their homes, offices, etc. Analyzing country wise online shopping, the US and UK are the top spenders. Below is an overview of online shopping.
What is E-commerce?
E-Commerce i.e. internet or electronic commerce is a process of buying and selling products and services online. This commercial transaction usually occurs over the internet. There are many types of E-commerce. All these depend to and from where the goods and services are moving. Payment for the retail services is usually conducted online as well.
Types of E-Commerce Merchants
E-Commerce is a sector which is full of all types of merchants. There are those that offer services while others sell tangible products. Additionally, the type of platform which they use also plays a crucial role in the transaction process. The two main types of E-Commerce include:
E-Commerce Merchants according To What They’re Selling Online.
You can classify online merchants depending on the items that they are willing to sell to consumers. E-commerce merchants offer a wide range of products and services to consumers. They include:
- Online Retail Stores Selling Physical Goods such as homewares, gift shops, apparel stores, etc.
- Service-based retailers: such as online educators, freelancers, and consultants.
- Digital products like online courses virtual goods, software, and graphics.
E-commerce Merchants according To the Parties Involved
It’s possible to classify E-Commerce platforms according to the parties involved. You need to analyze the parties which are participating in the online transactions. Some of the parties which you can identify may include:
Business to Business (B2B)
B2B E-Commerce transaction is normally between two business entities. Note that any business whose clients are other businesses uses this E-Commerce model. For instance, a large software business which sells its products to small software businesses.
Business to Consumer (B2C)
This is one of the most popular types of E-commerce. B2C happens when a business sells its products or services to consumers. An example of this is retail outlets such as IKEA, Macy’s, and Walmart among others.
Consumer to Business (C2B)
This type of E-Commerce is when the consumer sells their products or services to a business. Or this could mean that the consumer contributes monetary value to the business. A good example of C2B is the crowdfunding campaigns.
Consumer to Consumer (C2C)
This type of E-Commerce happens between two consumers. C2C model normally happens in marketplaces such as eBay. In this scenario, one consumer sells an item to another consumer.
Note that there are still other forms of E-Commerce parties including Consumer to Government (C2G), Government to Business (G2B), and Business to Government (B2G), etc.
This is how and where E-Commerce takes place. It’s important to understand the process of buying and purchasing goods online. Where and how E-Commerce transactions happen usually varies from retailer to retailer. The most common platforms include:
This includes internet sites which facilitate transactions between the seller and the consumer. Note that most online marketplaces don’t have inventories. They simply act as a connecting platform for consumers and retailers. They include:
This is a direct way of doing online business. Usually, a merchant creates their website which they use to sell commodities. There are also shopping carts as well as E-Commerce solutions. Popular online storefronts include:
- Oracle Commerce
Social platforms have quickly become the most popular E-Commerce platforms. They help to facilitate a straightforward transaction between the retailer and the shopper. The most popular social platforms include:
Advantages and Disadvantages of E-Commerce
The main advantage of E-Commerce is that it has an upper-hand over physical retailers. The internet is now a vital tool in modern society. From new products to marketing techniques you now the internet to understand what’s happening in the business world. Advantages of E-commerce include:
- Convenient and easy way to shop
- It’s available 24/7
- Perfect for remote shopping.
- There is no need to pay for utilities
- Consumers can purchase digital goods such as albums, videos, and music.
However, E-Commerce still has its own downsides. Selling or purchasing commodities from online retail outlets isn’t easy. Whether you are a seller or customer, you need to be cautious in case you end up falling victim of internet frauds. Common disadvantages of E-Commerce include:
- High risk of credit card fraud
- You cannot physically touch and fit items
- High level of competition among other retailers
The Bottom Line
It’s possible to buy or sell commodities via the internet. To merchants, this provides an easy and cost-effective way to sell items. There are minimal overhead costs because you don’t need a physical store. To consumers, E-Commerce offers convenience. You can make remote purchases from wherever you are. In addition to that, goods are normally shipped to your doorstep.
However, both the merchant and the customer need to be cautious. It’s possible to fall victim of internet fraud. Consumers need to make sure that they make purchases from verified retailers. On the other hand, retailers have to ensure they have a secure payment system in place to protect their finances.