In this post we look at key types of e-commerce and how they can move towards commercial success.

B2C – Business to Consumer Sales

These are the bulk of e-commerce companies and cover diverse industries. Customer attachment is key so appealing campaigns are personalized, engaging and responsive. Social media engagement helps to create lucrative bonds with the target audience alongside with customer support.

C2C – Consumer-to-Consumer

This sector covers things like eBay and Amazon where consumers sell to each other.

G2C – Government-to-Consumer

This includes such transactions as paying rent, fees, file sharing, licensing and so on.

B2B – Business to Business Sales

A key plus for having a business as a customer is that orders tend to be larger, often wholesale. On the negative side sales cycles are usually lengthy and there is often more than one decision-making party to deal with. Focus here is on developing trust and a long term business relations. This is a much more rational approach and the selling techniques include:

  • Special pricing eg, discounts on bulk orders.
  • Increased flexibility for ordering offline.
  • Facilities for rapidly placing repeat orders.
  • Quick, easy but mandatory account registration to ease communication.
  • Excellent after sales support.

C2B – Consumer-to-Business

This is the area of business where a freelancer or other entrepreneur sells their goods or services to business. They often use diverse marketing strategies in order to raise their online profile.

G2B – Government-to-Business

An example of this would be a Government website provided for businesses to pay tax or buy required licenses. G2B speeds up processes by cutting down on bureaucracy.

E-commerce & Type of Goods

Physical Goods

Online retailers sell physical goods in competition with real life high street businesses. Excellent product photographs, descriptions and customer service together with the reduction of customer risk by allowing returns are key growth strategies.

Digital Goods

Zero inventory, low overheads and fast delivery limits are tempting but there is tough competition. Businesses need to stress the benefits of buying digital content rather than simply downloading a free version.

Services

Lots of services are sold online and the ability to up-sell to customers is huge. Those offering repeat services on subscription tend to do well for example, a cleaning service that allows for repeat bookings. Customer engagement by email and telephone is key to building lasting relationships.

E-Commerce Business Models

Four of the main e-commerce business models include:

Dropshipping – a retailer sells the goods but inventory is held by a wholesaler who ships the goods direct to the customer. Low margins, lack of control, high competition and poor brand exposure are the major downsides.

Warehousing – retailer purchases direct from the manufactures and stores and delivers the goods. This involves financial and time investment but gives full control of business processes.

Private labeling and manufacturing – Goods are supplied under the retailer’s label but manufactured ‘on-demand’. This enables control over the goods while avoiding huge production costs.

White labeling

Retailers offer generic products under their own name. They save on design, development and manufacture but can still build a brand.

There are pros and cons of each type of business and business model but as long as there is a well-considered strategy all can be successful.

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