If you want to ease into an ecommerce juggernaut, I’d suggest you start a hybrid ecommerce, affiliate store. More on that later.
You’ll need to familiarize yourself with each type of business model before you start your ecommerce business:
Major Ecommerce Business Classifications
- B2B: Business to Business Ecommerce
- B2c: Business to Consumer Ecommerce
- C2C Ecommerce
- C2B: Consumer to Business Ecommerce
- Government / Public Administration Ecommerce
You’ll also need to identify an ecommerce platform that suits your preferred business model’s needs. In this post, I’ll walk you through the jargon.
Major Ecommerce Business Classifications
Electronic commerce encompasses all online marketplaces that connect buyers and sellers. The internet is used to process all electronic transactions.
The first thing to think about is the type of business transaction you’re going for. When you think about the business you want to run, who do you see yourself selling to? Is your business B2B, B2C, C2C, or C2B?
Do you have an idea for a type of ecommerce business that you’ve been thinking about for a while? Do those acronyms make your head spin? Let’s take a look at the most common ways online transactions occur.
A B2B model focuses on providing products from one business to another. While many ecommerce businesses in this niche are service providers, you’ll find software companies, office furniture and supply companies, document hosting companies, and numerous other ecommerce business models under this heading.
B2B ecommerce examples you may be familiar with include the ExxonMobil Corporation and the Chevron Corporation, Boeing, and Archer Daniel Midlands. These businesses have custom, enterprise ecommerce platforms that work directly with other businesses in a closed environment. A B2B ecommerce business typically requires more startup cash.
The B2C sector is what most people think of when they imagine an ecommerce business. This is the deepest ecommerce market, and many of the names you’ll see here are known quantities offline, too. B2C sales are the traditional retail model, where a business sells to individuals, but business is conducted online as opposed to in a physical store.
Examples of B2C businesses are everywhere. Exclusively online retailers include Newegg.com, Overstock.com, Wish, and ModCloth, but other major B2C brick-and-mortar businesses like Staples, Wal-Mart, Target, REI, and Gap.
B2B and B2C are fairly intuitive concepts for most of us, but the idea of C2C is different. What does a consumer-to-consumer ecommerce business look like?
Created by the rise of the ecommerce sector and growing consumer confidence in online sales, these sites allow customers to trade, buy, and sell items in exchange for a small commission paid to the site. Opening a C2C site takes careful planning.
Despite the obvious success of platforms like eBay and Craigslist, numerous other auction and classified sites (the main arenas for C2C) have opened and quickly closed due to unsustainable models.
C2B is another model most people don’t immediately think of, but that is growing in prevalence. This type of online commerce business is when the consumer sells goods or services to businesses, and is roughly equivalent to a sole proprietorship serving a larger business.
Reverse auctions, service provision sites like UpWork, and several common blog monetization strategies like affiliate marketing or Google AdSense also fall under this heading.
Government / Public Administration Ecommerce
The models listed above are the primary ecommerce retail structures, but they aren’t the only ones. Other types of ecommerce involve government/public administration conducting ecommerce transactions with businesses or consumers.
- B2G (also called B2A), for businesses whose sole clients are governments or type of public administration. One example is Synergetics Inc. in Ft. Collins, Colorado, which provides contractors and services for government agencies.
- C2G (also called C2A): typically individuals paying the government for taxes or tuition to universities.
Two sectors that are closed for entrepreneur owners but are growing include G2B for government sales to private businesses, and G2C, for government sales to the general public.
What Model Fits Your Idea Best?
Now that you know what types of ecommerce businesses, product options, platforms, and business classifications exist, you’re ready to get started. Take a look at your business plan.
If you found this article useful, please give it a share. Keep reading the Boldfruit blog for tips to help you succeed in ecommerce, from choosing your platform to marketing your products and site. If there’s a topic you would like to see covered that you don’t see in our archives, leave a comment below.