E-commerce a sales model with many facets: What are the types of e-commerce?
Want to start an e-commerce business but don't even know where to begin?
Rest assured! You are in good hands! Appvizer explains in this article all types of classic e-commerce, but also innovative e-commerce models.
Read to the end to get all this information.😜
What are the traditional e-commerce models?
In the e-commerce world, there are various models depending on the actors involved. If you are inexperienced in the field , choosing one model over another is very complicated. The known e-commerce types are: B2B,B2C,C2C AND C2B.
B2C Business to Consumer
The B2C model is one of the most popular models.The main actors are companies and consumers; the former offer their products or services while the latter buy them to satisfy their needs.
In this type of model, the markets involved are those who offer standardised products in order to ensure that these are purchased by customers.
If you choose this model, your marketing management will also be consumer-oriented.
As far as the price of the products is concerned, it is chosen by the company, which defines and modifies the price according to its needs and may give discounts to liquidate a stock.
B2B Business to Business
This type of sale takes place between companies in any sector that provide goods and services to each other. In this case, sales are more important.
An example of B2B e-commerce could be a business relationship between a manufacturer or wholesaler and a retailer.
B2B commerce is not oriented to the end customer, but to a database of companies, so the sales experience is not the same.
While B2C concerns finished products, in B2B the products can be of different types such as raw materials that can be combined before being sold to the end customer.
The price is set according to many criteria: the importance of the sale and the quantity purchased.In this type of sale, the price can be negotiated unlike the B2C model where the price is fixed and it is impossible to negotiate.The buyer sends a request for a quote as this type of sale is personalised, once the quote is received the buyer contacts the company to negotiate the price.
The sales process with the B2B model is often longer as more people are involved. Another element is the fact that this type of customer often has technical requirements, so negotiating and meeting their expectations is much more complex.
If you decide to sell with the B2C model you will therefore also be involved in the B2B model as a customer as you will buy from a company and then sell to the end consumer.
B2A Business to Administration
This type of e-commerce is similar to the B2B model in that it does not target end users. This type of model precedes transactions between companies and administrations online. If you hear of Business to Government, don't panic: it is just another way of calling the Business to Administration model.
In this type of e-commerce, the main actors are companies and public authorities, in most cases involving the exchange of legal and administrative documents. This form has developed in recent years for the simple reason that it speeds up procedures and saves time by allowing people to pay taxes and download necessary documents online without the need to travel.
C2C Consumer to Consumer
This type of model refers to the management of products or services between customers; in this type of sale, it is not necessary to have one's own e-commerce site.
The principle of this type of sale is that you place an ad on a site to sell an item, then you are contacted if your product interests a buyer. Thanks to this type of e-commerce, your items can have a second life and be used by another person.
One of the advantages of C2C is the fact that since there are no intermediaries you can do good business. C2C does not only concern the sale of products, but also services. The C2C model is one of the models that takes advantage of the growth of Internet sites.
C2B Consumer to Business
You may be wondering how this type of e-commerce could work .
Customers offer business buyers their products or services in such a way that if a company wanted to invest in this type of service, it could do so.
An example would be photographer's platforms where photographers upload photos that in order to be used by a company that wants to use them for its site they have to buy. It is certainly an overturned business model, but it has worked for many years.
C2A Consumer to administration
Finally, C2A takes up exactly the same idea as C2B. In this case the company is replaced by the administration, this model involves selling products or solutions directly online to administrations on the consumer side.
An example could be consultancy solutions for the development of training plans, for the national education system.
What are the innovative e-commerce models?
In order to adapt to a mode of e-commerce that is constantly developing, we recommend two types of innovative e-commerce models that will enable you to stand out from your competitors and increase your notoriety.
D2C Direct to consumer
This business model is becoming one of the most popular means as many brands want to enter different markets directly rather than through intermediaries in order to reduce costs. Therefore, they produce, market, sell and ship their products directly to the consumer.
In addition to saving money and reducing costs, by using this model you can strengthen your image and increase your reputation with consumers. One of the main advantages of this type of e-commerce is that you can improve your customer relations in this way.
White label and private label
White label is a product to which you can attach your brand name, which is purchased from another distributor.
As for private label, the seller asks a manufacturer to customise a product. With this type of model, you will be able to reduce your costs and you will not have additional expenses to make changes to the product.
In summary, we can say that e-commerce is developing into different types, as we have explained to you above, each model has a different approach.The model you choose will depend above all on your location and your needs, and often in order to be able to run your business, you will also be a player in several e-commerce models.
Article translated from Italian