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4 Types of E-commerce

We’ve previously talked about what e-commerce is. Now let’s explore the four basic types of e-commerce your business (or you personally) might choose to take part in. Remember, there’s nothing stopping you from pursuing more than one type of e-commerce at a time.

Here are the four basic types of e-commerce you should know about.

Business to Consumer

Business to Consumer e-commerce is the most commonly thought of form.  This form of e-commerce is the selling of goods and services from a business to an everyday person via an electronic network, such as the internet.  This person is typically an unknown person the business has no professional relationship with and has no reason to trust.  Consumers will usually be able to enter an order into the business’ system.  Payment information, such as credit card data is typically collected.

Business to Business

Business to Business e-commerce involves businesses buying from and selling to each other via electronic means.  Usually the businesses have or form a trusted business relationship.  Sometimes their systems may integrate with each other to make the process easier.  Supply chain is what is typically thought of for this.  A business orders their supplies from another business to use to produce a product for a consumer, or resell it to a consumer.  Another form of B2B e-commerce is a business providing backend support to another business.  For example, purchasing a shopping cart is a B2B transaction that can occur on the internet between two businesses.  The shopping cart is not a part of the businesses supply chain, but is necessary to support the functioning of the business.

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Consumer to Consumer

Consumer to Consumer is a basic trade of goods between two people, neither of whom are going through a legally set up business.  Electronic marketplaces and payment systems such as eBay and PayPal are set up to allow these types of transactions to occur.  Craigslist is another example of a place where consumers can advertise goods.  These are typically one-off transactions and the consumers rarely know each other.

Business to Government

Business to Government is the selling of goods and services to a government.  E-commerce comes into play with systems that allow businesses to place bids on government contracts over a network.

These are the basic types of e-commerce.  I’ve seen other “types” of e-commerce as well, such as m-Commerce, but upon further inspection, they can be traced back to one of these types.  Your mobile device doesn’t sell something to a person, it simply facilitates the transaction between two of the above parties.  That is not to say that another form of e-commerce won’t come around either.  What types of e-commerce have you participated in?

This was originally published on January 16, 2013.

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