When we think of e-commerce, most of us may picture a commercial transaction that is happening online between a supplier and a client. This idea is right, but there are different types of entities with different natures that participate in e-commerce, and we shall discuss them here.
Various entities may participate in e-commerce, but most of them may fall under three categories, namely businesses, administrations, and consumers.
The businesses are the private businesses that offer products or services online. They may be selling physical goods (e.g. gadgets, furniture, books and appliances), digital goods (e.g. music, e-books, software, videos, and images), and services (e.g. travel agencies, laundry pickup and delivery, and insurance providers). Those who sell digital goods can operate solely online, whereas those who offer physical goods and services may require a physical delivery system.
Administrations are public administration or government entities that operate online. They can transact with businesses and consumers mostly for documents and government registry.
Lastly, the consumers of e-commerce are the private individuals, clients, or end-users, who are paying for the products and services offered by businesses and administrations.
Types of e-commerce
The different types of e-commerce are mainly defined by which participant interacts with whom. Right now, there are six established e-commerce types, and they are as follows:
Business-to-Consumer (B2C). This is what usually comes to mind when people hear the term “e-commerce”. It is predominantly the retail section of e-commerce, where the traditional retail trade operates. The main rationale for B2C types is the elimination of the need for physical stores and the ease with which a consumer may shop from the comfort of their gadgets.
Business-to-Business (B2B). Both participants in this e-commerce type are businesses. A great example of a business-to-business type is a company that gets its business management software from another company that sells software applications tailor-made for businesses.
Consumer-to-Business (C2B). E-commerce may empower consumers to originate requirements for businesses to fulfill. An example of this would be a job board where a consumer could place requirements for a certain project, for which multiple companies would bid to win.
Consumer-to-Consumer (C2C). This is when a consumer sells to other consumers. Think eBay.com, where users may buy from and sell products to other consumers. Since eBay.com is also a business, the nature of this platform can be considered C2B2C or consumer-to-business-to-consumer e-commerce.
Business-to-Administration (B2A). This type encompasses all the online transactions between companies and public administration. It involves many services, including social security, employment, permits, and legal documents. With a lot of governments worldwide investing in e-government, B2A types have considerably increased in recent years.
Consumer-to-Administration (C2A). C2A refers to all the electronic transactions between individuals and public administration. Its applications include government ID registration, social security payments, bill payment, and filing tax returns and payments. The e-commerce system also allows consumers to post feedback or request for information from government administration or authorities.
E-commerce is a rapidly growing industry and, for those of us who participate in it, it helps to understand its different types and players. Although most of us may think that we are one type of participant in e-commerce, each of us may be different participants at different times. A business owner who bought a point-of-sale system from another business online, for example, is conducting a B2B. But when she buys a smartphone from Amazon.com for personal use, she is involved in a B2C transaction.