�E-Commerce AND ITS MODELS

Introduction

• The term e-commerce was coined back in the 1960s, with the rise of electronic commerce – the buying and selling of goods through the transmission of data – which was made possible by the introduction of the electronic data interchange. E-commerce has changed the way in which society sells goods and services.
• E-commerce has become one of the most popular methods of making money online and an attractive opportunity for investors. For those interested in buying an e-commerce business, this article serves to provide an introduction to e-commerce, covering the reasons for its popularity, the main distribution models and a comparison of the major e-commerce platforms available.

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What Is E-Commerce

• E-commerce (electronic commerce) is the activity of electronically buying or selling of products on online services or over the Internet.  Electronic commerce draws on technologies such as mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems.

��E-Commerce Consist Of

• The exchange of goods and services of money consist of:
• Buyers: these are the people who want to purchase goods or services.
• Sellers: these are the people who offer goods and services to the buyers.
• Producers: these are the people who create the goods and services that sellers offer to buyers.

Difference between traditional commerce and e-commerce

E-commerce is further divided into:

MODELS OF E-COMMERCE

B2B

• Business-to-business is a situation where one business makes a commercial transaction with another. This typically occurs when:
• A business is sourcing materials for their production process for output (e.g. a food manufacturer purchasing salt). Example: Providing raw material to the other company that will produce output.
• A business needs the services of another for operational reasons (e.g. a food manufacturer employing an accountancy firm to audit their finances).
• A business re-sells goods and services produced by others (e.g. a retailer buying the end product from the food manufacturer).
• Example: ALIBABA- It connects business to global manufactures.

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B2C

• The term business-to-consumer (B2C) refers to the process of selling products and services directly between a business and consumers who are the end-users of its products or services. Most companies that sell directly to consumers can be referred to as B2C companies.
• Example: Amazon, Walmart

C2B

• Consumer-to-business (C2B) is a business model in which consumer create value and businesses consume that value. For example, when a consumer writes reviews or when a consumer gives a useful idea for new product development then that consumer is creating value for the business if the business adopts the input. In the C2B model, a reverse auction or demand collection model, enables buyers to name or demand their own price, which is often binding, for a specific good or service. Inside of a consumer to business market the roles involved in the transaction must be established and the consumer must offer something of value to the business.
• Example: Freelancer, bloggers, Odesk- Person is self employed and is not necessarily committed to a particular employer in long-term. Freelance workers are sometimes represented by a company or a temporary agent.

C2C

• Consumer to consumer (C2C) markets provide an innovative way to allow customers to interact with each other. Traditional markets require business to customer relationships, in which a customer goes to the business in order to purchase a product or service. In customer to customer markets, the business facilitates an environment where customers can sell goods or services to each other.
• Example: OLX, eBay

Examples

Process of E-commerce

Impact on society

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•  Speed up the buying process and save time for customer
• Reviews Available
• Able to provide detailed information to the customer.
•  Best Quality of services in reasonably low operation cost
• Quick and affordable marketing
• Provide flexibility to the customer to buy product 24/7
•  Less store setup cost and quick ROI
•  No Geographical limitation
• Reduce Resource hiring and training cost
•  Avoid human error while dealing with customers
• Compare product and price

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Common Applications for E-Commerce

• Domestic and international payment system
• Enterprise content management
• Group buying
• Instant messaging
• Online shopping and online tracking
• Online banking
• Teleconferencing
• Electronic tickets
• Social networking

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Disadvantages�

• Lack of personal touch
• Unsure about the quality
•  Late Delivery
• Security issues
•  Some products are difficult to purchase online for eg. Gold silver
• It is difficult to try before buying
• Site Crash issues

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Statistical data on E-commerce

It’s estimated that there will be 2.05 billion global digital buyers in 2020.

In fact, with an estimated global population of 7.7 billion people, 40 percent of the world’s population is shopping online.

This number is rising rapidly and is expected to hit a massive 2.14 billion people in 2021.

In billions

The number one reason people shop online is that they’re able to shop anytime.

Other key reasons include the ability to compare prices , lower prices, to save time, and the convenience of not having to go out shopping.

Amazon statistics

• Amazon is the leading online retailer with a net revenue of $232.88 billion in 2018.
• Amazon has over 100 million Amazon Prime members.

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eBay statistics

Conclusion

•  E-Commerce is not just about conducting business transactions via the Internet. Its impact will be far-reaching, and more prominent then we know currently. This is because the revolution in information technology is happening simultaneously with other developments, especially the globalization of the business. The new age of global e-commerce is creating entirely new economy and that will tremendously change our lives, will reshape the competition in various industries, and alter the economy globally. As companies are gaining high profits, more and more other companies are developing their websites to increase their profits. Since more businesses are being held online resulting in high economy development and emergence of a more innovative and advanced technology.

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