I’m sure you have been hearing the word ‘E-Commerce’ in the news, social media, friends and everywhere else. E-commerce, also known as electronic commerce or internet commerce is the buying and selling of goods or services using the internet. The common usage of the word e-commerce is when referring to the sale of a physical product but can also describe any commercial transaction that occurs online.
The first e-commerce transaction occurred on August 11, 1994 when a man sold a CD to his friend over a website called Netmarket. Since then the e-commerce industry has grown into a multi-million-dollar industry and is estimated to be a $27 trillion industry by 2020. So, this means everyone has an opportunity to be part of this industry and have a piece of the pie.
In South Africa, the e-commerce industry is growing daily as more and more consumers become comfortable in buying goods and services online, just see how the boutiques are thriving on Instagram. There are four types of business models within the e-commerce industry which are:
- Business to Consumer (B2C)
This model is when a business sells goods or services to an individual customer. E.g. you buy a pair of jeans from an online boutique.
- Business to Business (B2B)
This model is when a business sells goods or services to another business. E.g. A online boutique buying stock from a wholesale market or online
- Consumer to Consumer (C2C)
This model is when a consumer sells their own products or services to another consumer. E.g. you sell your old cellphone on gumtree.
- Consumer to Business (C2B)
This model is when a consumer sells their own products or services to a business. E.g. an influencer promotes a brand or business for a fee.
- M – Commerce
This is a fairly new model which involves conducting transactions using a wireless handheld device aka a cellphone.
Within each model, one can choose to sell through retail, wholesale, drop shipping, crowdfunding, physical products, digital services or services. Since you have the basics now, we may begin to expand on this industry together.
Let me know what you think and let’s explore e-commerce together.