E-Commerce refers to any form of business transaction conducted online. The most popular example of E-Commerce is online shopping, which is defined as buying and selling of goods via the internet on any device. However, E-Commerce can also entail other types of activities, such as online auctions, payment gateways, online ticketing, and internet banking.
E-Commerce has had a major impact on the markets that businesses can reach. Businesses now have the ability to reach a large global market allowing for a greater returns on their product sales. The retailers would be able to sell more product at a lower cost, as a result of the business being done online and not by manpower alone. Although we may take advantage of E-commerce and the ease it creates in our daily lives, its benefit to the global economy is always changing and ever-increasing as technologies continue to develop. Every day we see new businesses from all over the world implementing E-commerce into their business strategies, resulting in the growth of a “global community”.
E-Commerce Business Model
E-Commerce is typically classified into three different models based on the type of participants involved in the transaction. Broadly speaking these business models are;
- Business to Business (B2B): B2B is when businesses sell to other businesses. This is typical of stationery stores who sell office equipment in bulk to businesses. Normally B2B companies provide a discounted rate per unit if customers buy in bulk which is great motivation for offices to avail of.
- Business to Consumer (B2C): B2C is the most commonly thought of business model where merchants sell to consumers who buy a small amount of produce. A familiar example of the B2C model would be supermarkets where consumers buy their shopping weekly but they wouldn’t normally bulk buy anything.
- Consumer to Consumer (C2C): C2C is a relatively new business model where consumers who previously bought something seek to resell this item to another consumer. Through marketplaces like eBay and Craigslist, this can be easy and quite lucrative for selling items that you no longer have a use for.
The Benefits of E-Commerce
There is a reason why E-Commerce has demonstrated such explosive growth in the past couple of years. Indeed, with the internet becoming an essential requirement of everyday life, businesses are learning to take advantage of the numerous benefits of E-Commerce, the most notable of which include:
- Reduced costs– E-Commerce businesses benefit from significantly lower running costs. As there is no need to hire sales staff or maintain a physical storefront, the major E-Commerce costs go to warehousing and product storage.
- Around the clock availability– Another great benefit of running an online business is that it is always open. For a merchant, it’s a dramatic increase in sales opportunities; for a customer, it’s a convenient and immediately available option. Unrestricted by the working hours, E-Commerce businesses can serve customers 24/7/365.
- Targeted marketing– With access to such a wealth of customer data and an opportunity to keep an eye on customer buying habits as well as the emerging industry trends, E-Commerce businesses can stay agile and shape their marketing efforts to provide a better-tailored experience and find more new customers. Just consider for a moment that you have a chance to address thousands of your customers by their first name; that is something already.
- Working from anywhere– Often, running an E-Commerce business means that you don’t need to sit in an office from 9 to 5 or suffer through a commute day-in and day-out. A laptop and a good internet connection is all it takes to manage your business from anywhere in the world.
There is a logical order in how you would go about building an E-Commerce online platform store. Although setting up an actual online store would probably take less than a day, researching, building, launching and growing a profitable E-Commerce business is a multi-layered process involving a number of steps and decisions. Here at Xtranet Communications we do provide E-Commerce platform development keeping into consideration the product idea research, competition, pricing strategy and unique value proposition.
Learn more about the Xtranet Communications Limited here http://xtranet.co.ke/