Types of E-Commerce
E-Commerce or electronic commerce, a subset of e-business, is the
purchasing, selling, and exchanging of goods and services over computer
networks (such as the Internet) through which transactions or terms of sale
are performed electronically. Contrary to popular belief, ecommerce is not
just on the Web. In fact, ecommerce was alive and well in business to
business transactions before the Web back in the 70s via EDI (Electronic
Data Interchange) through VANs (Value-Added Networks).
In simple words, E-Commerce is doing the work of commerce
electronically.Now, it is not that we have E-Commerce between certain
groups only; rather we have E-Commerce that can be between many
groups.Therefore, we do not have only one type of the E-Commerce, but we
have many types of the E-Commerce.Our E-Commerce can be between
business and business, or between business and consumers, or can be
between business and employees, and can be many more. E-Commerce can
be broken into four main categories: B2B, B2C, C2B, and C2C.
Business
Business
Customer
Customer
B2B
B2C
C2B
C2C
Business-to-Business (B2B)/ Inter-Organizational E-Commerce:
It is the largest form of e-commerce involving business of trillions of
dollars. In this form, the buyers and sellers are both business entities and do
not involve an individual consumer. It is like the manufacturer supplying
goods to the retailer or wholesaler. E.g. Dell sells computers and other
related accessories online but it is does not manufacture all those products.
So, in order to sell those products, it first purchases them from different
businesses i.e. the manufacturers of those products.
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Companies doing business with each other such as manufacturers
selling to distributors and wholesalers selling to retailers. Pricing is based on
quantity of order and is often negotiable.
Business-to-Consumer (B2C)/ Intra-Organizational E-Commerce:
As the name suggests, it is the model involving businesses and
consumers. This is the most common e-commerce segment. In this model,
online businesses sell to individual consumers. When B2C started, it had a
small share in the market but after 1995 its growth was exponential. The
basic concept behind this type is that the online retailers and marketers can
sell their products to the online consumer by using crystal clear data which is
made available via various online marketing tools. E.g. An online pharmacy
giving free medical consultation and selling medicines to patients is
following B2C model.
Businesses selling to the general public typically through catalogs
utilizing shopping cart software. By dollar volume, B2B takes the prize,
however B2C is really what the average Joe has in mind with regards to
ecommerce
as
a
whole.
Consumer-to-Business
(C2B)/
Intermediaries
E-Commerce:
A consumer posts his project with a set budget online and within
hours companies review the consumer's requirements and bid on the project.
The consumer reviews the bids and selects the company that will complete
the project. Elance empowers consumers around the world by providing the
meeting ground and platform for such transactions.
Consumer-to-Consumer (C2C):
It facilitates the online transaction of goods or services between two
people. Though there is no visible intermediary involved but the parties
cannot carry out the transactions without the platform which is provided by
the online market maker such as eBay.
There are many sites offering free classifieds, auctions, and forums
where individuals can buy and sell thanks to online payment systems like
PayPal where people can send and receive money online with ease. eBay's
auction service is a great example of where person-to-person transactions
take place everyday since 1995.
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There are other types of e-commerce business models too like
Business to Employee (B2E), Companies using internal networks to offer
their employees products and services online--not necessarily online on the
Web--are engaging in B2E (Business-to-Employee) ecommerce.
Government-to-Government (G2G), Government to Business (G2B) and
Government to Citizen (G2C) but in essence they are similar to the above
mentioned types. Moreover, it is not necessary that these models are
dedicatedly followed in all the online business types. It may be the case that
a business is using all the models or only one of them or some of them as per
its needs.
G2E (Government-to-Employee), G2B (Government-to-Business),
B2G (Business-to-Government), G2C (Government-to-Citizen), C2G
(Citizen-to-Government) are other forms of ecommerce that involve
transactions with the government--from procurement to filing taxes to
business registrations to renewing licenses. There are other categories of
ecommerce out there, but they tend to be superfluous.
Peer to Peer (P2P):
Though it is an e-commerce model but it is more than that. It is a
technology in itself which helps people to directly share computer files and
computer resources without having to go through a central web server. To
use this, both sides need to install the required software so that they can
communicate on the common platform. This type of e-commerce has quite
low revenue generation as from the beginning it has been inclined to the free
usage due to which it sometimes got entangled in cyber laws.
m-Commerce:
It refers to the use of mobile devices for conducting the transactions.
The mobile device holders can contact each other and can conduct the
business. Even the web design and development companies optimize the
websites to be viewed correctly on mobile devices.
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