There are primarily six eCommerce business models :
- Business-to-Business (B2B)
- Business-to-Consumer (B2C)
- Consumer-to-Business (C2B)
- Consumer-to-Consumer (C2C)
- Business-to-Government (B2G)
- Consumer-to-Government (C2G)
1. Business-To-Business (B2B)
As the name suggests, the businessto-business model of eCommerce is one where the exchange of good or service takes place between corporations instead of individuals.
It is usually a situation whereby one company provide goods or services online with other companies as its target audience.
- When a mobile app development company is offering its IT solutions to some real estate companies seeking to build an app for their client base, in this situation, the mobile app company advertises its service on their website whilereal estate companies that are interested can request a price quotation through the same channel.
- A cybersecurity firm is offering its online security software that mitigates credit card fraud to an e-commerce company.
2. Business-To-Consumer (B2C)
The B2C eCommerce business model is what usually comes to people’s mind when they hear the word “e-eommerce.” It is perhaps this popularity that is also responsible for the increased activity in this field.
B2C eCommerce refers to the distribution of goods and services from business to members of the public who are its customers. It is one of the earliest forms of eCommerce and has grown massively in the last two decades as observed from retail giants Amazon.
- All major online retail stores like Amazon and payment processors like PayPal.
A traveling agency that provides ticket and travel insurance policies to clients.
- A digital education website such as CodeAcademy that lets users learn basic computer programming for free.
3. Consumer to Business (C2B)
The C2B eCommerce model is the opposite of B2C meaning that in this case, would be consumers are now the ones offering goods and services to business operators.
Interestingly, the C2B industry is arguably the most significant employment channel other than paid office jobs, because the transactions are borderless.
We divide C2B eCommerce owners into two categories:
- Independent workers
These set of people offer products or services on a website they created for this purpose. The approach allows them to interact with clients directly and negotiate deals on their terms.
Majority of C2B eCommerce owners under this channel are service providers and product sellers on freelancing sites such as Fiverr and Upwork.
Examples of C2B
- A sports blogger who bills a gaming company to promote their services on his blog or signs up for Google Adsense to display ads that suit his audience in exchange for profits.
- Social media managers, content creators, brand managers, programmers, and many other services providers working online.
- A photographer selling his images on websites such as Fotolia or 123rf.
- Social media users filling in surveys.
4. Consumer-To-Consumer (C2C)
Under the C2C eCommerce business model, consumers sell to consumer usually through a third-party website or an independent online platform that they created for this purpose.
Generally, all peer-to-peer transaction of goods and services carried out online falls into the C2C e-commerce business model. It requires a high level of trust between the customers and not necessarily on the platform on which the trade is carried out.
- The foremost example of C2C via a third-party website would be an auction platform like eBay which brings seller and buyers together. eBay charges a fee for facilitating each sale while the other parties to the transaction are responsible for settling other matters such as product quality, packaging, shipping, and refunds.
- Cryptocurrency exchanges that offer over-the-counter trades to users. Under such circumstance, the exchange charges a fee for the transaction while it allows the users to transact cryptocurrencies with one another.
- It is important to note that most businesses operate the B2C and C2C models simultaneously even though they may decide to start up with one. In most cases, though, the B2C comes first while the C2C follows shortly as an extension and additional revenue source.
- If you plan to go down this path, you may need to do more extensive research to find out what buyer behavior is prevalent in the market before deciding which model to employ first.
5. Business-To-Government (B2G)
As the name rightly suggests, the B2G eCommerce model is one where a business sells its product or service to the government of either. the area where its operations are based or elsewhere.
In most case, businesses under this umbrella have these government or public administrative offices as their only clients and receive contracts on a long-term basis. Such a situation makes it possible for them to easily calculate profits and manage funds effectively while delivering their solution to a wide audience.
- A government using a virtual workspace software designed by a creative agency.
- The situation in Ohio where the state’s tax department haired the service of a third party to collect and convert tax payment in cryptocurrencies to fiat.
6. Consumer-To-Government (C2G)
C2G is just the opposite of the last eCommerce business model albeit a little difference; this time it is the consumers or members of the public that offer value to the government or public administrative agencies.
However, it is still the public administration or government that initiates the transactions, often as a way to ease its operations and relieve the citizenry of some burdens. The public does not bear any responsibility whatsoever if the platform conducting the C2G transactions goes offline or fails to deliver.
Examples of C2G
- A State’s tax agency deciding to ditch paper tax filing and instead introduce an electronic tax filing portal.
- A State creating an information sharing platform to allow citizens to get the latest information possibly because of a suspected natural disaster.
- An electronic voting app for citizens to participate in an election without having to visit the polling unit or filing paperwork.
- Otherforms of transactions between citizens and the government either facilitated by the government directly or via a third-party.