What Is Electronic Commerce (Ecommerce)?
Electronic commerce (ecommerce) refers to companies and individuals that buy and sell goods and services over the Internet. Ecommerce operates in different types of market segments and can be conducted over computers, tablets, smartphones, and other smart devices. Nearly every imaginable product and service is available through ecommerce transactions, including books, music, plane tickets, and financial service such as stock investing and online banking. As such, it is considered a very disruptive technology.
What is an ecommerce website?
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An ecommerce website is your digital storefront on the internet. It facilitates the transaction between a buyer and seller. It is the virtual space where you showcase your products, and your online customers make their selections. Your website acts as the product shelves, sales staff, and cash register of your online business channel.
Businesses might create a branded store experience on a store like Amazon, build their own commerce site on a dedicated domain, or do it all for a multi-channel approach.
What are the types of ecommerce?
Ecommerce takes as many different forms as there are various ways to shop online channels. A few common business models that shape the world of ecommerce are:
- B2C – Businesses sell to individual consumers (end-users). The most common model with many variations.
- B2B – Businesses sell to other business. Often the buyer resells products to the consumer.
- C2B – Consumers sell to businesses. C2B businesses allow customers to sell to other companies.
- C2C – Consumers sell to other consumers. Businesses create online marketplaces that connect consumers.
- B2G – Businesses sell to governments or government agencies.
- C2G – Consumers sell to governments or government agencies.
- G2B – Governments or government agencies sell to businesses.
- G2C - Governments or government agencies sell to consumers.
Online shopping evolves and shifts daily. People shop from their computers, phones, tablets, and other devices. They patronize websites, visit social media pages, and participate in thriving virtual channels. Here’s an overview of three distinct methods of conducting ecommerce today.
M-commerce
Online transactions that take place on mobile devices are known as mobile commerce or “m-commerce.” With portable devices in the hands of consumers worldwide, it's no wonder m-commerce is expected to overtake non-mobile commerce 2021.
Many people now do their product research and online purchasing through their phones. This trend shows no signs of slowing, so it’s essential to optimize your online store for mobile.
Enterprise ecommerce
Enterprise ecommerce is the buying and selling of products to large companies or organizations. If a large business sells many different types of products or has multiple brand lines and transitions into selling online, then it is participating in enterprise ecommerce.
Social media ecommerce
Social media can help you market and promote ecommerce stores to a broad audience. Just as social media enables you to connect with friends and family, it also has the potential to attract customers to your business. Done well, social media marketing engages customers in an informal setting.
Social media can help you:
- Attract new customers
- Build brand awareness
- Generate online sales
What are the advantage and disadvantages of ecommerce?
- Is growing rapidly
- Offers global marketing reach
- Provides the ease of ordering products online
- Generally involves lower operating costs
- Gives direct-to-consumer access
- Despite a lot of advantages, ecommerce does have downsides. Some businesses may try to avoid ecommerce due to challenges like:
- Limited face-to-face interaction
- Technical difficulties
- Data security can be a challenge
- Shipping and fulfillment at scale