What is E-commerce business models and it’s strategies? We are sure you have been hearing these terms every now and then. But the question still remains the same, What is E-commerce? Why is it being used all over the news, articles and websites?
E-commerce, also known as electronic commerce or internet commerce refers to the buying and selling of goods or services through the internet online. It includes transfer of money and data in order to make these transactions.
E- business is a vast concept which includes every kind of online business whereas E-commerce specifically refers to the transaction of goods and services. This includes books, music, plane tickets, and financial services such as stock investing and online banking etc.
E- commerce has grown drastically in the past decade and will continue to grow forever. There are tons of online businesses that have germinated in recent years. It has benefited every sector and has made it incredibly easier to discover products and services.
E-commerce business models to focus on:
There are four main types of e-commerce models that you must know about:
- Business to Consumer (B2C)- When a business sells a good or service to an individual consumer, it is said to be B2B Model. The consumer can go through the website, find their desirable product and order it whenever they want. The website notifies the organization and the product is dispatched to the consumer. It’s as easy as that. Eg- You buy a dress online.
- Business to Business (B2B)- When a particular website sells its product to a buyer who further sells it to the final customer, it is said to be a B2B Model. It can be also defined as when a business sells a product/ service to another business. Eg- An wholesaler buying products in bulk and then selling it at one of it’s retail outlets.
- Consumer to Consumer (C2C)- A website that follows the C2C business model helps consumers to sell their assets like residential property, cars, motorcycles, etc., or rent a room. This is done by giving the information about their product online on website. Eg- You sell your furniture to someone on eBay.
- Consumer to Business (C2B)– Here, the consumer sells their own product or service to a business. Eg- monetization strategies, loans, etc. Also, for example, when a photographer licenses his/her photographs for use in any website.
Some excellent examples of E-commerce that are gaining popularity-
It is the sale of a product by a business directly to a customer. This does not include any intermediary or third party. Online retail models require a web presence from both physical and digital companies. The retailer sells the goods to it’s customers after buying it from whole-sellers. B2B and B2C are the most common e-commerce retail models.
It is the sale of products in bulk. This usually takes place between a wholesaler and a retailer. The retailer then further sells the product to customers. Wholesale e-commerce is selling goods in bulk online to other businesses. Wholesalers are able to buy products in bulk from the manufacturer at cheaper prices. Some examples are Grainger , BuySwings etc.
The sale of a product, which is manufactured and shipped to the consumer by a third party. Drop shipping is a retail fulfillment method where a store doesn’t keep the products. Instead, when the store sells a product, it purchases the item from a third party and has it shipped directly to the customer. As a result, the seller doesn’t have to handle the product directly.
It’s the collection of money from investors or people in order to gain funding for a product. This takes place before the product or service being actually launched in the market. One of the example is- Indiegogo.
5. Digital products:
Goods, templates, courses, books or media that can be downloaded for consumption or licensed for use. Businesses can choose to sell non-physical or intangible products that have their fair share of demand. This is becoming extremely popular these days.
Some Best Examples to Learn from are-
“Anyone who stops learning is old, whether at twenty or eighty.
There are innumerable startups and businesses in E-commerce that can guide you with the right path. We have short-listed a few of them. So learn from every place and imbibe everything that will help you bloom!
1. Greats – Brooklyn sneakers
Just like many other successful e-commerce websites, Greats focuses on providing a quality product that aligns with an honorable social mission. They give staggering discounts to customers and have positioned themselves good. They have done a killer campaign and followed good marketing strategy online.
2. Warby Parker – Online eyeglasses without the markup
It is an American online retailer of prescription glasses and sunglasses. Their products deliver a quality with great services. With their amazing marketing online, they have won an excellent consumer base.
3. ModCloth – Women’s vintage-style fashion
This is a brand for women’s clothing and fashion-wear. Their high-quality photos, behind-the-design blog posts, and down-to-earth product listings make the entire experience of shopping their store a fun and engaging one.
4. Bonobos – Better-fitting, better-looking men’s pants
The store has a specific emphasis on the sale of men’s suits, trousers, denim, shirts, shorts, swimwear, outerwear and accessories.They try to create a unique customer experience. They’ve built a strong online community out of their customers, ensuring that they will return to their e-commerce website over and over again.
5. Coal and Canary
In need to set the mood? This is the first place you will think of for buying aromatic scented candles. The company showcases its Canadian pride with a badge in the site’s footer, letting customers know that they’re supporting a local business and manufacturer.
Scrolling through their website will leave you hungry. The high quality pictures of scrumptious dishes here will leave your mouth water. A great feature of this site is the ability to chat with the business directly. Customers can chat live or leave their contact information.
When you do business online, you want to make sure that your website represents who you are and what you do. Hebe has just done it right! They have a beautiful website which leaves the customer to scroll through their page again and again.
Some killer strategies to grow your E-commerce business-
If you are about to start a business, it is definitely going to be tough, but you don’t need to embark into the unknown by yourself! We have some tactics and e-commerce business model strategies that will help you throughout your career!
1. Build your brand awareness
Create high quality content, invest in ads, partner with other businesses in your industry, create strong web pages, etc. Be active on social media sites like Facebook, Twitter, Instagram, and Pinterest.
Create a positive social image in front of your customers about the brand. Something that a lot of marketers may not understand: it’s the indirect benefits of content marketing that drive results. And in a lot of cases, it’s about SEO.
2. Add reviews and ratings to your site
A study of 1,000 consumers discovered that better reviews is the number one thing that will make people choose a higher-priced option. A great review helps to gain the trust of your customers which is very important. Work on this and make your brand no. 1.
3. Use data analysis to improve your strategy
Having a clear sense of who your target customer is and developing a proper attribution system in place to effectively measure the efficacy of your marketing. Work on TARGETING, SEGMENTING AND POSITIONING. This gives you an idea about which set of customer group requires what add-ons.
4. Offer exclusive sales to your loyal consumer base
You need to find a way to entice customers to return to your store. What is better than a DISCOUNT?? Hence, go for it. Give offers or discounts to your existing customers. Know your customer’s purchase history, and send personalized product recommendations.
5. Provide excellent customer service to improve customer loyalty
Keeping a customer is much cheaper than acquiring a new one! A customer loyalty program helps keep your customers loyal. Offer your customers free giveaways, vouchers, etc. Maintain a good relationship with your customers and provide them with the best quality services. Reply to their queries on time and never procrastinate.
Therefore, with the right kind of planning, the proper infrastructure, and sound strategies, your company will be ready to experience substantial growth.
Keep these points in mind and shape your perilous destiny. Learn from every hurdle, if you fall with a thud, rise with an applause!