A commercial transaction, in the electronic context of e-commerce, is any money-related transaction made by consumers or businesses over the Internet. The type of electronic commerce characterized as “business-to-consumer” is distinguished by establishment of an electronic business relationship between a firm and a final consumer. This type of e-commerce has developed significantly since the introduction of the Internet, and many virtual stores and shopping malls are already available online, selling various types of consumer goods, such as computers, software, books, shoes, cars, food, financial products, digital publications, and so on. Typical transactions of electronic commerce include buying books (such as from Amazon) and buying music (downloading music as digital distribution, like from the iTunes store), and, to a lesser degree, customizing/customizing liquor stores online inventory services.
Nearly any conceivable product and service is made available via e-commerce transactions, including books, music, airline tickets, and financial services like stock investment and online banking. Customers can purchase any product on any e-commerce site worldwide, without having to leave their place of business or home. Customers cannot walk into an e-commerce shop and pick up a product instantly, like they could with a physical shop. E-commerce may substitute for physical stores, although some businesses prefer to keep both. Simply put, e-commerce has the same concept as a physical shop, except that all transactions and interactions occur via the Internet.
It also provides the ability to reach people too busy to shop during regular store hours. E-commerce has just become a bigger part of our lives, and it is also a much more profitable business model compared to physical stores. By comparison, Amazon started their business on a model of online sales and delivery for products. Thanks to these two e-commerce giants, online transactions are now an ordinary part of the way companies conduct business. As you discover in the section about types of e-commerce, online transactions can involve other areas, such as when businesses sell products and services to other businesses. You may be used to businesses selling products and services to consumers on the internet (B2C e-commerce), but sometimes, individual customers may be selling products and services to businesses. B2C is the most common model for e-commerce because of a companys e-commerce business being able to establish a direct connection to its products or services to consumers electronically.
B2C e-commerce is the most common online business type, covering a wide range of products, from apparel to entertainment. E-commerce only includes product and service transactions, whereas e-business covers every aspect of an online businesses operations. The former category is businesses that are defined by types of goods sold (involving everything from ordering digital content to consume immediately online, ordering traditional goods and services, and meta services that facilitate other types of e-commerce). Business-to-business electronic commerce is not aimed at consumers, typically involves products such as raw materials, software, or products being combined. E-commerce is composed of both consumer-to-business and enterprise-to-enterprise e-commerce, and the intra-organizational transactions that underpin these activities. Business-to-business (B2B) e-commerce covers any electronic transactions for goods or services conducted between companies. E-commerce, in its entirety, is the maintenance of relationships and the execution of commercial transactions, including the sale of information, services, and goods, through the use of a computer-based telecommunications network.
E-commerce is commonly used to refer to selling physical products on-line, but can also describe any type of commercial transaction facilitated through the Internet. The Business-to-Consumer type of ecommerce corresponds with the Retail segment of ecommerce, in which conventional retail commerce usually operates. Business-to-consumer means the sale is made between the business and consumer, such as when you purchase a carpet from an online retailer. This business model involves consumers exchanging their products and/or services directly with a business through electronic means. High-end products or services are typically exchanging with other businesses, who may then sell them directly to consumers or use them in their own production processes. An example of an eCommerce model between businesses is seen with smaller businesses buying goods on Amazon Marketplace for resale to consumers.
In a business-to-business scenario, the website may let customers list work that they would like done, and let businesses bid on that opportunity. The C2B eCommerce model gives consumers the ability to set their own prices, or to let businesses directly bid on meeting their needs. Ecommerce has become an essential tool for both small businesses and big businesses around the world, to not only sell to customers, but to also attract customers. E-commerce brings convenience for customers, since they do not need to travel far from their homes, but just surf websites online, particularly for buying products that are not sold at their local stores. Customers across the world are easily able to buy products on E-commerce sites — companies are no longer restricted by geographical barriers or by physical barriers. Online shopping makes purchases simpler, faster, and less time-consuming, with 24 hour sales, fast shipping, and easy returns. By using the Internet and other networks for electronic commerce, organizations in certain industries are able to transact purchases and sales transactions directly with customers and suppliers, eliminating inefficient middlemen.
Many different business models have emerged for Internet-based electronic commerce, including virtual storefronts, information brokers, transactions brokers, Internet markets, content providers, online service providers, virtual communities, and portals. The following argument about types of electronic commerce illustrates just how pervasive transactions online have become across a wide variety of business models. Several key issues are discussed which will shape the development of the e-commerce of the future, including integrating e-payments in the purchasing process, creating consumer markets, the management of electronic businesses, and the new brokerage. As younger generations move to an era of conducting commercial transactions, the online space is becoming increasingly relevant for the selling of goods to businesses.
Everything that you purchase from an online retailer as a consumer–think clothing, home supplies, entertainment–is done in B2C transactions. A C2C company — also called an online marketplace — connects consumers for the exchange of goods and services, typically making its money through a transaction fee or listing charge.