What is e-commerce?

During times when many industries act widely in the Internet, this phenomenon couldn’t omit e-commerce. Permanent Internet access,  almost everywhere and any time, causes that traditional shops are not enough. Anyway, does e-commerce industry mean only e-shops? Does it only relate to product sales for consumers? And who benefits from it? Look for the answers in our article.

The explanation of the issue

The e-commerce includes all business transactions made by means of ICT tools. The most popular form are online stores, which enable you to shop online. However you should remember that e-commerce also includes online betting, exchange offices as well as constantly developing electronic banking (e-banking).

Present form of e-commerce results from an intensive development of business sector service at the beginning of Internet. In the 1980’s, that is one decade after first Arpanet network node appeared, the usage of Internet in e-commerce started being considered. When in 1992 the prohibiton of commercial Internet use was abolished in the USA the machine was off at full steam.

Types of E-commerce

In e-commerce, parts who participate in trade exchange can be both companies and customers in different configurations. That is why we can distinguish the following types of e-commerce:

  • B2B (Business to Business) – it concerns trade exchange between companies. We can include here not only product or service sales, but also building a network of suppliers and customers, as well as expanding the network of business partners.
  • B2C (Business to Customer) – it’s a kind of e-commerce based on commerce between company and customer. The most often used tools in this model are online auctions, e-shops or multilevel sales. Apart from product and service sales, this kind of model is meant to create a relationship with customers.
  • C2C (Customer to Customer) – this is the model conducted between customers and none of the customers is an entrepreneur. The tools used in this kind of model are usually online auctions.
  • C2B (Customer to Business) – it’s a commerce between customer and company. It usually consists in placing bids on some services by customers, to which companies answer. However this model isn’t used very often.

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Advantages of e-commerce

The popularity of e-commerce results in many benefits both for customers and companies. The most important advantages are:

  • 24/7 availability,
  • global reach (contrary to traditional shops),
  • limited maintenance costs,
  • the possibility of offering a greater number of products,
  • quicker and easier entry into a market.

E-commerce is for many people a great way (and sometimes only one possible way) for starting a business. Limited initial costs and a great number of potential customers are an ideal solution to start your own business. On the other hand many businesses, which already have a strong position in the market, can’t ignore this solution if they want to keep their popularity and high reputation.