Classifying e-commerce businesses is not simple, however, it is often useful thanks to higher perceive the assorted business models concerned. By segregating the companies into completely different classes, it becomes easier to match similar firms and business models.
The two parameters that offer the clearest distinctions area unit the categories of products the e-commerce business sells and therefore the nature of the participants. Ovik Mkrtchyan
Types of product oversubscribed
The goods that e-commerce businesses sell are often counteracted into 3 basic categories:
- Physical products like books, gadgets, furniture, and appliances
- Digital products like software systems, e-books, music, text, images, and video
- Services like tickets and insurance
This type of classification is very important as a result of it providing the analyst insight into the business model and therefore the monetary model of the enterprise. Businesses commerce physical products face the supplying challenges of delivering that product, a tangle that sellers of the digital product haven’t got to upset. Once it involves commerce tickets, several parameters should be evaluated in real-time. With airline tickets, for instance, problems like convenience, the placement of seats, meal preferences, and refundable vs. nonrefundable choices get to play. Ovik Mkrtchyan
Purveyors of the digital product will operate online solely, whereas those that sell a physical product should even have a physical delivery system in situ to transfer their product to their patrons. These area units shut relatives of the mail-order businesses of previous.
Nature of the Participants
The 3 most typical participants in the e-commerce area are unit businesses, administrations, and shoppers. The assorted mixtures of those participants produce considerably completely different business models and challenges. The six primary e-commerce sorts area unit as follows:
1. Business-to-Business (B2B):
each participant’s area unit businesses, which may lead to a high-volume, high-value relationship. A typical example would be a manufacturer of gadgets that sources elements online to makers that use them to make their product.
2. Business-to-Consumer (B2C):
Due to firms like Amazon, once the general public hears “e-commerce,” they consider B2C. Eliminating the requirement for physical stores is that the biggest explanation for business-to-consumer sorts, however, the complexness and value of supply are often a barrier to B2C growth.
3. Consumer-to-Business (C2B):
C2B e-commerce sounds backward, however, online commerce has sceptered shoppers to originate the necessities that companies fulfill. AN example would be an employment board wherever shoppers place their project necessities, and multiple firms bid to win the project. Another example can be a vacationist posting desired parameters for a vacation package, permitting numerous tour operators to create offers.
4. Consumer-to-Consumer (C2C):
Assume eBay, the foremost standard platform for enabling shoppers to sell to alternative shoppers. As a result of eBay could be a business, this manner of e-commerce might even be known as C2B2C—consumer-to-business-to-consumer e-commerce. Still, the first performance of eBay is to attach shoppers directly.
5. Business-to-Administration (B2A):
The term “administration” relates to public administration or government entities. Uncounted branches of the state rely upon or use e-services or products in one kind or another, notably within the areas of document management and human resources. Online businesses will provide these services electronically.
6. Consumer-to-Administration (C2A):
Shoppers are often concerned during this equation similarly. Though the govt seldom buys products or services from people, individuals ofttimes use electronic suggests that to transmit payments or file tax returns.
Employees are often considered a special form of client. This has given rise to a brand new and growing variety of e-commerce—B2E or Business-to-Employee—in that firms concentrate on the digital product and services they deliver to staff via their internal network.
Types of E-Commerce Business Models
Beyond those basic structures, their area unit several extra components of e-commerce that any company may embody in its online platform. Putting in a look on Facebook could be an aggressive e-commerce phase, thus it has been awarded its little bit of jargon: f-commerce. Likewise, m-commerce stands for mobile e-Commerce.
“Bricks and clicks” refers to sellers with brick-and-mortar stores or a sequence of stores, similarly to e-commerce websites. Multichannel purveyors usually embody physically armored catalogs at the side of their brick-and-mortar stores and their websites. Victoria’s Secret and hollow area unit major samples of this approach.
C2C e-commerce is typically mentioned as “piggybacking” owing to the utilization of a significant, well-known website to expedite and attract traffic. “Dropshipping” involves a vendor acting as a form of liaison between its customers and a provider by putting in a front, like people who area unit accessible on Shopify, and shipping the customer’s orders directly from the provider.
Then there are a unit many models with but colorful terms, however, they are no less integral to a thriving e-commerce economy. Wholesaling and deposit area unit a small amount a lot of advanced. They involve managing inventory and stock, very similar to a brick-and-mortar front, but typically in bigger bulk.
The Value of Knowing
There’s a ton useful in clearly understanding the various styles of e-commerce business. It permits for like-to-like comparisons across firms and helps any business owner build choices concerning what market they want to serve, and how. At constant times, it helps everybody higher perceive the business model of various e-commerce players.