Before we check the different e-commerce business models, let us briefly discuss the types of e-commerce business classifications. With the rise in popularity of e-commerce, people are increasingly finding themselves thinking about opening online businesses. E-commerce models can be categorized into following categories.
• Business to business(B2B)
• Business to consumer(B2C)
• Consumer to consumer(C2C)
• Consumer to business(C2B)
• Business to government(B2G)
• Consumer to government(C2G)
a) BUSINESS TO BUSINESS (B2B)- B2B, or Business to Business, is the largest e-commerce model. In this model, both the sellers and buyers are business entities. This model describes the transactions between a retailer or a wholesaler, or a wholesaler and manufacturer. Also, the transaction of the B2B business model is much higher than that of the B2C model. In this model, the products are being sold to an intermediate buyer who then sells the product to the final customer. As younger generations enter the age of making business decisions, B2B selling in the online space is becoming more important. Some of the examples of B2B models are Alibaba (world’s largest online business to the business trading platform), Amazon business, IBM, Boeing, ExxonMobil Corporation, and more.
b) BUSINESS TO CONSUMER (B2C) - In this model, the product is being sold to the end user. It is one of the most common use business models. Business to consumer, known as B2C, is the most common and the thickest e-commerce market. In this model, the decision-making process is shorter than B2B model. The B2C business is the most common type. This is the thickest e-commerce market. In this online model, the business sells to individual customers. This business model offers direct interaction with customers. Some examples of B2C models are WalMart, Staples, Target, and REI.
c) CONSUMER TO CONSUMER (C2C) - This model helps consumers to sell their things (assets) like -property, cars, etc., or rent a room by publishing their information on the website Companies like Craigslist and eBay who pioneered this model in the early days of the internet. The C2C or consumer to consumer business model involves a transaction between two consumers. It is also known as a citizen to citizen. A common example of this model would be an online auction, where a customer or visitor posts an item for sale and other customer bids to purchase it. However, the third party generally charges a commission. The few examples for this model include Craigslist, eBay and OLX.
d) CONSUMER TO BUSINESS (C2B)- In this model, consumer process towards a website showing multiple business organizations for a particular service. Customer to business, known as C2B, involves customers selling their services or products to business. It is roughly the same as a sole proprietorship serving a larger business. One thing that differentiates C2B from other business models is that the consumers create the value for the products. The consumer places an estimate of amount he/she wants to spend for a particular service or it allows a customer to sell their products to companies. In this e-commerce model, a site might allow customers to post the work they want to be completed and have businesses bid for the opportunity. Affiliate marketing services would also be considered C2B.C2B examples include Google Adsense, Commission Junction, and Amazon. Fotolia is also emerging as a good C2B example.
e) BUSINESS TO GOVERNMENT (B2G) - It is alternative of B2B model. Such websites are used by governments to trade and exchange information with various business organizations. Business to government is also referred to as the business to administration commerce. In this model, government and businesses use central websites to do business with each other more efficiently than they can off the web. This e-commerce model is also referred as public sector marketing, i.e., marketing services and products to multiple government levels. With this platform, businesses can bid on government opportunities, including tenders’ auctions, and application submission.
f) CONSUMER TO GOVERNMENT (C2G) - Consumer to administration or consumer to government e-commerce model enables the consumers to post feedback or request information regarding public sectors directly to the government administration or authorities. For example, when you pay electricity bill through government websites, payment of health insurance, make payment of taxes, etc.