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Classify the e-commerce Business Based on the Type of Goods

Classify the e-commerce Business Based on the Type of Goods

sachin     26 Feb 2018     e-commerce      NA     

Ever wondered how many types of e-commerce businesses are there? How do we classify them? If you’re thinking there isn’t only one, then you are both right and wrong at the same time. Thinking about Online shopping? Yes, of course, online shopping falls under the term e-commerce but there are a total of 6 different types of e-commerce that you should really know about.

When we talk about e-commerce, the first thing that comes to our mind is that it is an online based commercial or sales transaction that takes place between the trader and the customer. While the idea of the e-commerce business is quite simple, there are still several factors involved that classify e-Commerce into six major types. 

While classifying e-commerce businesses can be tricky, it is essential to ascertain the basis and purpose of these businesses by segregating them into categories. Some of them are as similar as a process of splitting hairs.

Classifying e-commerce Business Based on the Type of Goods Sold

  1. Tangible goods like gadgets, appliances, books and furniture
  2. Digital goods such as sale of e-books, text, software, images, and videos
  3. Sale of services such as insurances and tickets

In order to have a better understanding of e-commerce businesses, this type of classification is essential because it gives us a clear insight into the financial and the business model of the company. Companies delivering physical goods faces huge challenges in logistics while sellers of digital goods don’t face the same. When we talk about selling services for instance selling tickets, there are many factors that must be evaluated in real time such as such as availability, the location of seats, meal preferences, and refundable versus nonrefundable.

E-commerce business models can be divided into six major types, such as:

Business-to-Business (B2B) model

In this model of e-commerce both the participants are business and mainly focus on providing goods from one business to another and thus the volume and the value of B2B e-commerce can be huge as a result. All the transactions are carried out electronically and are related to the sale of goods and services. For E.g. Boeing, ExxonMobil Corporation and the Chevron Corporation.  

Business-to-Consumer (B2C) model

This is a type of e-commerce business model which is related to the transactions between businesses and the customers and is the deepest e-commerce market in the world. This is a type of e-commerce most closely related to the retail e-commerce trade that takes place online and encompasses all transactions between businesses and consumers in which the consumer purchases a finished product from the business. B2B e-commerce model represents the virtual version of retail transactions such as would take place in a mall.

Consumer-To-Consumer (C2C) model

 A type of e-commerce where electronic transactions of goods and services are carried out by two consumers. C2C model is mostly conducted through a third-party that provides an online platform for transactions. For instance, Ebay.com is the most popular form of C2C model that enables consumers to sell other consumers.

Consumer-to-Business (C2B) model

 Most people don’t know if this type of model even exists, but C2B model is one of the fastest growing forms of e-commerce business model. This is a complete reversal of the selling and buying process that takes place electronically where individuals make their products or services and sell them to companies. Some examples are a job board where consumers place their requirement to let multiple companies bid for them, free photographs, design elements and so on.

Business-to-Administration

This type of e-commerce business deals with transaction-related between companies and public administration. This model is related to the public administration or government entities. Many branches of government, today are dependent on or use e-services or products in one form or another. Various services such as social security, legal documents, fiscal measures, employment come under B2A.

Consumer-to-Administration

An e-commerce business model where electronic transactions are carried out between people and public administration. For e.g. electronic tax filing, information sharing, and distance learning.

PROS of E-commerce

  1. Maybe the best advantage of e-Commerce is its tremendous reach and gathering over the worldwide market, with least ventures. It empowers dealers to pitch to a worldwide gathering of people and furthermore clients to settle on a worldwide decision. Geological limits and difficulties are annihilated radically decreased.
  2. Through direct communication with definite clients, this e-Commerce procedure slices the item conveyance bind to a huge degree. An immediate and straightforward channel between the maker or specialist organization and the last client is made. Along these lines, items and administrations that are made oblige the individual inclinations of the intended interest group.
  3. The procedure of e-Commerce empowers vendors to come nearer to clients that promptly expanded efficiency and immaculate rivalry. The client can likewise pick between various vendors and purchase the most applicable items according to prerequisites, inclinations, and spending plan. In addition, clients now approach virtual stores every minute of every day.
  4. Online business additionally prompts critical costs reduction. It prompts a critical lessening of exchange costs and in like manner clients likewise get the opportunity to purchase at a lower rate.

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