E-commerce, or electronic commerce, refers to the buying and selling of goods on the internet. This term is often used to describe businesses that operate on the internet or selling physical products online. However, it could describe any kind of commercial transaction that is facilitated though the internet(think transferring money from the bank, paying rent, etc.)
A brief history
E-commerce began on August 11th, 1994 when a man sold a CD by the band "Sting" to his friend through NetMarket. This is the first ever transaction on the internet where a consumer purchases a product. Nowadays, thousands of these transactions happen every day through huge retail giants such as Amazon, Shopify, and eBay. The size of the global e-commerce market is almost at $5trillion! This figure is estimated to grow even larger over the next few years, showing that e-commerce is becoming a profitable option for online retailers
Types of e-commerce models
There are four main types of e-commerce models that could describe almost all of the transactions that happen online.
1. Business to Consumer(B2C) - This is when a business sells goods or services to an individual consumer, such as when you buy a pair of shoes from an online retailer 2. Business to Business(B2B) - This is when a business sells goods or services to other businesses, such as when a company sells its advertising skills as a service for other businesses 3. Consumer to consumer(C2C) - This is when a consumer sells goods or services to another consumer, such as when you sell your old laptop on eBay for some extra cash 4. Consumer to Business(C2B) - This is when a consumer sells their goods or services to a business, such as when a TikTok star advertises for a toothbrush company
Examples of e-commerce
E-commerce could talk on many forms. Here are a few very common ones that you see everywhere online-
Retail: When a product is sold from a business directly to a customer without any middleman
Wholesale: When products are bought in bulk, often by retailers, then sold directly to consumers
Dropshipping: I'm sure you've seen one of the weird YouTube ads where a "millionaire" on Amazon talks about the benefits of dropshippping. This is the sale of a product manufactured and shipped to the customer via a third party.
Crowdfunding: This is when money is collected from customers in advance of a product being available to fund the startup capital necessary for the product to be brought to market. Think kickstarter.
Subscription: This is the automatic and recurring purchase of a product or service regularly until the subscriber chooses to cancel.
Physical products: Any product that requires inventory, needs to be replenished, and has to be physically shipped to customers as sales are made
Digital products: Any downloadable digital goods, templates, and courses, or media that must be purchased and licensed to use. Think renting a movie on Disney+ or a course on MasterClass. Don't pirate!
Services: A skill that is provided to a consumer in change for compensation. The most frequent exchange is time for money.
How could YOU get involved?
The future of e-commerce seems bright. The market is still growing, and you might be able to make some money along the way! Currently, you could sell your things online through a variety of e-commerce platforms such as Amazon, eBay, and Shopify. Personally, I recommend Amazon for its AMAZING FBA(Fulfillment By Amazon) program. In this program, Amazon will handle all the shipping, storage, and returns for your business, and all you have to do is get your product to their warehouse! It costs a small fee, but it is definitely worth it for your time! If you have a couple hundred bucks lying around, why not use it to start an e-business!