What is e-commerce?

What is e-commerce?

by Christian Bagnimbo on 19/11/2021

Updated at 17/05/2022

Many merchants are turning more and more to the internet to sell their products. The e-commerce is a sector in full and strong growth. Online sales are attracting more and more people and are becoming almost mandatory for all companies doing business. In this article, we will show you everything there is to know about e-commerce.

E-commerce, what is it?

According to Wikipedia, online commerce, or e-commerce, is the monetary exchange of goods, services or information through computer networks, especially the Internet. 

In simple terms, e-commerce represents the various commercial transactions that take place on the Internet. The purchase is made through different machines such as computers, smartphones, tablets, consoles, televisions ...

Different forms of e-commerce

The e-commerce is very broad and includes several models. Thus we have as models:

  • B2C e-commerce (Business-to-Consumer): This is the best known form. Here the company sells directly its products or services to the final consumers. 
  • The B2B e-commerce (Business-to-Business): In this model, sales are made between two companies. It is the case of a manufacturer who supplies his products to a wholesaler or reseller.
  • C2C e-commerce (Consumer-to-Consumer): Here, it is the setting in relation between two consumers. This model can be observed on certain sites like eBay.
  • The C2B e-commerce (Consumer-to-Business): In this form, the consumer offers his products or services to companies. 

These four models are the most common and best known. However there are several other types such as:

  • G2C (Government-to-Consumer) and C2G (Consumer-to-Government): Exchanges between the government and individuals
  • B2E ( Business-to-Employee): Exchanges between a company and its employees.
  • And others...
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What are the advantages of e-commerce?

If e-commerce is booming, it is because it has many advantages. Here are some of them:

  • Increase of customers : With your online store, you are visible from anywhere in the world. You can therefore sell your products anywhere in the world. This possibility allows you to considerably increase your customers because you reach people from several countries.
  • Accessible at any time: unlike physical stores, which have opening hours and are not accessible 24 hours a day, the online store has no hours. The website remains open and accessible to the public all day long and the customer can therefore make his purchases at any time.
  • Reduction of the operating costs: being able to do without a physical store makes it possible to reduce the costs compared to the operation of a traditional trade. And if the e-commerce works by putting in contact suppliers with buyers, there will not even be production costs (case of dropshipping)
  • More profits: the reduction of the costs and the increase of the number of customers allow to reach a bigger margin than with a traditional trade, even by lowering the prices. We sell more and we earn more money.
  • Scalability: with e-commerce, you can sell to one or a thousand people at the same time unlike a physical store where you have a limit to the number of customers you can serve at a time. With e-commerce, your only limit is your product inventory.

 Here are some of the advantages of e-commerce. However, like anything else, e-commerce has not only advantages but also disadvantages and challenges.

Disadvantages and challenges of e-commerce

  • Limited customer interaction: Since all interactions are done online, it can be more difficult to understand your customers' needs and concerns. While there are still ways to gather their concerns (survey data, customer service interactions, etc.), it requires more work than talking to buyers in person.
  • Lack of customer trust: Despite all the advances in terms of the security of online financial transactions, many people still do not fully trust online transactions. This lack of trust is even greater when your site is new.
  • No possibility to touch, test or try the product: buyers like to touch physical products to be sure they are making a good purchase. How to overcome this disadvantage? With complete product sheets, including images, videos, product images, a very detailed product description and even virtual reality technology.
  • Technical difficulties: e-commerce requires a minimum of technological knowledge, which not everyone has. If the e-commerce site is slow, down or unavailable, it means that no sales will be possible. Site outages and technology failures can damage customer relationships and negatively impact the financial results and brand awareness of the company. The best way to solve this problem is to delegate the maintenance of your site to experts.
  • Time to get results: getting visibility for an online business is more difficult than it seems. Indeed, you can have a very good product and be present on a good platform, but you have to work on your SEO to gain visibility.

Want to create an e-commerce website?

If you have read our article so far, it's probably because you are interested in e-commerce stores. If you have decided to create one after reading this article then look no further. Oshara is the best web agency that can help you create the right online store for you.

Choose our e-commerce service and get a custom made e-commerce website.

Christian Bagnimbo

Christian is a project manager and SEO specialist for Oshara. A true geek and digital lover, he loves to share his passion for digital marketing, technology and everything that goes with it.

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