The term “ecommerce” refers to a website where commercial transactions are carried out. This means any website where such transactions are conducted can be considered an ecommerce site, even though it may not be an online store per se. For instance, you have a website through which you offer content, and someone buys something from it. In that case, your website is part of the world of ecommerce.
This is an umbrella term, so many do not understand the subtleties between an ecommerce site and a similar one. For instance, take an online marketplace. Is it an ecommerce site? Yes. However, is an ecommerce website an online marketplace? It may or may not be one, depending on the purpose for which it is designed. The difference between the two is that a marketplace sells someone else’s products, whereas an ecommerce site may sell the company’s own products or other retailers’ goods. Under ecommerce comes a broad range of businesses, and a marketplace is just one of these.
Forms of Ecommerce Business Models
Four kinds of ecommerce businesses make trade possible between a seller and a buyer. Let us take a brief look at these below.
- B2C (Business to Consumer): In this business model, the company sells their products or services directly to consumers. The business of online retailers is based on this model.
- B2B (Business to Business): In this model, a business gives their offerings to another one. Businesses offering SaaS (Software as a Service) products or selling their goods in bulk follow this model.
- C2C (Consumer to Consumer): Here, the transaction happens between one customer and another. An example of this business model is an end-user selling their used products to others.
- C2B (Consumer to Business): C2B ecommerce transactions take place when one consumer provides value to an organization. An example is online portals, which provide freelance services.
What Does an Ecommerce Platform Refer to?
Ecommerce platforms are software programs, which enable setting up and managing an online store. The program comes with every necessary tool needed to promote and sell ecommerce products. It also enables businesses to review their store performance, define product pricing, manage stock and run promotions.
An ecommerce platform can either be a cloud-based one or an on-premise platform. Most small and medium-sized businesses prefer the former platform because the initial investment is not that significant, and they can scale the usage without having to make any big changes in their infrastructure.