What is Ecommerce?
E-Commerce is the act of buying and selling goods or services on the internet. Ecommerce is also known as online shopping, e-shopping, or web shopping. The term “e-commerce” is often used for online buying and selling physical products but can also refer to services and intangibles bought and sold online.
E-Commerce can be an extremely lucrative business venture due to low overhead, little need for employees, and the popularity of electronic payments. However, e-commerce success requires significant time and effort to promote products via social media, email, internet search engines, and other avenues.
At the present time, e-commerce is the most popular way to shop because it is accessible and convenient. Based on statistics, they conclude that by the end of 2021, there will be over 2.14 billion online shoppers globally. The increase was greatly influenced by the COVID-19 pandemic.
In addition, more platforms are created for it, and businesses have been embracing digital selling and promotion. Game changer features are also made available by big e-commerce companies like Amazon and eBay. This includes 1-click shopping.
Although the earliest transaction happened in 1994 on a retail website, the transfer of documents through an electronic method known as Electronic Data Interchange can be traced way back to the 1960s.
From there on, e-commerce has evolved and paved the way to huge online shopping powerhouses like Amazon, eBay, Rakuten, and Alibaba.
The most significant advantage of e-commerce is the fact that businesses have a wider reach. Once their products are published online, they will be visible to millions of buyers worldwide.
It also enables sellers to lower costs because no physical store or retail staff are needed. All transactions are made through the internet, and payments are usually processed through secure methods like PayPal, Stripe, and Wise.
While the biggest disadvantage of e-commerce is the risk of online fraud. This affects buyers as it is challenging to know if the product they purchase is original or even exists. Moreover, it will be harder for buyers to return the item they bought due to high shipping costs and low production value.
For sellers, one drawback to note is the time and knowledge needed to set up an e-commerce website. Although platforms have made building websites as effortless as possible, other factors can affect the creation process, like product and competitor research, branding, and creating copy, images, and other media.
Establishing an e-commerce site can take less than 30 minutes or 12 months, depending on how prepared the business is.
Types of E-Commerce Business Models
- Business to business – This model is applicable for companies that sell goods and services to other companies.
- Business to consumer – This model is the most common among the list. The B2C model applies when the seller is in direct contact with their customer to transact goods and services.
- Consumer to consumer – C2C model is a popular type of selling and buying among customers. It can be done on various platforms like Facebook, Instagram, Craigslist, and other online marketplaces.
- Consumer to business – C2B allows consumers to sell to companies and is usually in services. One great C2B example is affiliate marketing services and works marketplace like Upwork.