Ecommerce or “electronic commerce” is the trading of goods and services online. The internet allows individuals and businesses to buy and sell an increasing amount of physical goods, digital goods, and services electronically.
Some businesses sell exclusively online or use ecommerce to expand the reach of their other distribution channels. Either way, ecommerce is thriving and can be a profitable venture. Let’s dive into the details of how ecommerce works and find out if it’s right for you.
Where and how does ecommerce take place?
Ecommerce offers people the convenience of shopping from their computers, phones, tablets, and other devices. They visit websites, social media pages, and other virtual channels to find what they’re looking for. Entrepreneurs, startups, small and medium-sized businesses, and large retailers can all use ecommerce to reach customers across the globe. Selling online might be a business’s sole revenue source, or it might be part of a multi-channel selling strategy. For example, a large brick-and-mortar retailer might adopt an online sales channel, or an entrepreneur might sell a small number of specialty handcrafted goods through a social media site like Facebook, Instagram, or Pinterest.
Another ecommerce example is social media commerce. Some websites like Facebook support online purchases. A business that generates revenue solely through its presence on social media, or entrepreneurs who supplement their income using social media marketing techniques, are also engaging in social media commerce.
Other ways you can participate in ecommerce include building standalone websites, or setting up shop on an established selling website. For example, you can create a storefront to represent your brand in the Amazon store.
What types of ecommerce are there?
Ecommerce takes as many different forms as there are various ways to interact with online channels. For example, sellers and buyers exchange goods and services through m-commerce, enterprise commerce, and social selling destinations like Amazon Live.
A few common business models are:
- B2C: Businesses sell to individual consumers, sometimes called the “end customer.”
- B2B: Businesses sell to other businesses. Often the buyer resells products to the consumer.
- C2B: Consumers sell to businesses. C2B businesses allow customers to sell to other companies.
- C2C: Consumers sell to other consumers. Businesses create online shopping destinations to connect customers.
- B2G: Businesses sell to governments or government agencies.
- C2G: Consumers sell to governments or government agencies.
- G2B: Governments or government agencies sell to businesses.
- G2C: Governments or government agencies sell to consumers.
What is an ecommerce website?
An ecommerce website is an online store where customers can find products, browse offerings, and place purchases online. It facilitates the transaction between a buyer and seller.
A digital storefront can serve as the virtual equivalent of the product shelves, sales staff, and cash register of a physical shop. Other components of an online store might include product listings, product categories, and customer reviews.
What is an ecommerce business?
Steps to starting an ecommerce business
The steps to starting an ecommerce business can vary depending on factors like what you want to sell. For example, if you’re selling services, then there’s no need to manage inventory or fulfillment. However, if you want to sell products online, then inventory and fulfillment will likely play a critical part in your operations.
Here are some steps you can follow to get started:
- Research business ideas.
- Make sure there’s demand for the products you want to sell.
- Determine how you’ll sell and ship products to customers.
- Find suppliers and manufacturers.
- Choose which online channels you’ll sell through.
- Create a website or online storefront and list products.
- Create a plan for your fulfillment strategy.
- Begin attracting customers with promotions.