Technology, Tools

What is E-Commerce?

August 15, 2022

What is e-commerce? Loosely speaking, the term may be applied to any commercial transaction which is carried out over a computer network. It may also refer to the supporting infrastructure which allows such transactions to take place. For example, someone who makes an online store, or someone with a website advertising their copywriting skills, engages in e-commerce. The word “e-commerce” may also be used to describe the practice of gathering business intelligence. Business intelligence data can be used to focus and direct your marketing efforts more efficiently, thereby supporting your online business transactions.

The following article is intended as an introduction to the question: “what is e-commerce?” After reading this article, you should be primed to get started with your own e-commerce website.

What is E-commerce?

As mentioned, e-commerce consists of financial transactions conducted online, as well as the gathering and application of information for marketing purposes. Just like traditional commerce, there are four basic types of e-commerce:

  • B2C (Business to Consumer): Arguably the most familiar form of e-commerce for many people, B2C transactions consist of a business selling its products or services to its consumer base. This is also where business intelligence comes into play, providing information to businesses on how to better reach their target audiences. A variety of digital marketing techniques allow a business to refine its understanding of its primary client demographics. They also help boost web traffic, and convert visitors into customers.
  • B2B (Business to Business): On an international level, major businesses often broker deals for the large-scale licensing of services or intellectual property. They also arrange for the trade of large quantities of material goods, often for inclusion in other products. These types of business to business transactions are a big part of e-commerce today, as they are increasingly supported through custom-designed websites and a more active corporate presence online.
  • C2B (Consumer to Business): This is an increasingly prevalent aspect of e-commerce, in which consumers post their needs online, along with a budget for a particular project. This might involve the services of a single afternoon, or it may be a long-term arrangement. Businesses and service providers bid on acquiring a particular project, with the consumer selecting the winning bid. Often notoriously associated with contractor fraud in traditional commerce, this is gaining popularity in the e-commerce world. It is a model often used for writing and marketing services, typically through a third-party “marketplace” website such as eLance, Upwork (formerly oDesk), or Fiverr.
  • C2C (Consumer to Consumer): Consumers often buy and sell their goods in arrangements with other consumers, without either side constituting a business-type organization. This has happened courtesy the classified ad sections of newspapers for decades – if not longer. In the present day, it also happens online. There are online classifieds for most newspapers, as well as more widely encompassing websites such as Craigslist. Websites like eBay and Amazon also facilitate C2C, as well as B2C transactions.

As you can see, what e-commerce “is” is not necessarily a simple answer, but its individual parts are fairly easy to understand. If you require further help, there are additional e-commerce resources available from a variety of sources. These include sources such as the e-commerce network Shopify, which has a vested interest in helping its members to succeed, along with Entrepreneur magazine, and organizations such as the Small Business Administration.

What are my E-commerce options?

If you are anything like most of those individuals who search for information on the basics of e-commerce, you’re looking to get your own online businesses started, so we’ll go with that as a focal point from here on out. The following options primarily cover business to consumer type transactions, with a little bit of consumer to business and consumer to consumer on the side.

Click here for some more resources relating to business to business type e-commerce.

Online Store

Many domain registrars and web hosting providers, such as Wix and GoDaddy, provide various levels of e-commerce support. This generally involves the use of a click-and-drag website builder, which makes putting together a simple and relatively professional-looking website much easier than if you had to do it from scratch. These types of setups allow you to list products, and will usually facilitate credit card transactions (often for a small fee per transaction).

These types of website hosting packages cost more than those which entail non-commercial websites – such as personal blogs and hobby pages. However, they make the process of establishing an online store relatively simple, by putting everything you need in one place. With your own domain name, you can personalize your online presence at every level.

Online Shopping Network

In many ways, the differences between signing up for a shopping network and creating an online store are minimal. Many of these networks, such as Etsy and Shopify, allow for their clients to open online stores using their own domain names; they may even provide domain registration services directly. They handle payment methods, and may allow for the association of other website elements, such as blogs.

The two experiences are not identical, of course. Often, the online shopping network offers a more standardized theme. They try to make up in advanced features what they lack in individual customization, and often succeed – depending upon your particular needs. A store opened within a network such as this is likely to provide significant and powerful features for a much lower cost than that which you would have to pay to a typical hosting provider for a completely independent online store.

“What is E-commerce?” Further Information

Here are a few more potential resources for e-commerce information. Please note that some of this may take you beyond the bare basics which we have attempted to cover here.