Types of e-Commerce

The term "e-business" was coined by Lou Gerstner, CEO of IBM.

There are mainly five types of e-commerce models:

1. Business to Consumer (B2C) - As the name suggests, it is the model involving businesses and consumers. This is the most common e-commerce segment. In this model, online businesses sell to individual consumers. When B2C started, it had a small share in the market but after 1995 its growth was exponential. The basic concept behind this type is that the online retailers and marketers can sell their products to the online consumer by using crystal clear data which is made available via various online marketing tools. E.g. An online pharmacy giving free medical consultation and selling medicines to patients is following B2C model.

2. Business to Business (B2B) - It is the largest form of e-commerce involving business of trillions of dollars. In this form, the buyers and sellers are both business entities and do not involve an individual consumer. It is like the manufacturer supplying goods to the retailer or wholesaler. E.g. Dell sells computers and other related accessories online but it is does not manufacture all those products. So, in order to sell those products, it first purchases them from different businesses i.e. the manufacturers of those products.

Benefits:

·         Encourage your businesses online

·         Products import and export

·         Determine buyers and suppliers

·         Position trade guides

3. Consumer to Consumer (C2C) - It facilitates the online transaction of goods or services between two people. Though there is no visible intermediary involved but the parties cannot carry out the transactions without the platform which is provided by the online market maker such as eBay.

4. Peer to Peer (P2P) - Though it is an e-commerce model but it is more than that. It is a technology in itself which helps people to directly share computer files and computer resources without having to go through a central web server. To use this, both sides need to install the required software so that they can communicate on the common platform. This type of e-commerce has quite low revenue generation as from the beginning it has been inclined to the free usage due to which it sometimes got entangled in cyber laws.

5. m-Commerce - It refers to the use of mobile devices for conducting the transactions. The mobile device holders can contact each other and can conduct the business. Even the web design and development companies optimize the websites to be viewed correctly on mobile devices.

There are other types of e-commerce business models too like Business to Employee (B2E), Government to Business (G2B) and Government to Citizen (G2C) but in essence they are similar to the above mentioned types. Moreover, it is not necessary that these models are dedicatedly followed in all the online business types. It may be the case that a business is using all the models or only one of them or some of them as per its needs.

DIFFERENCE BETWEEN e COMMERCE & e BUSINESS

1.     e-Commerce or Electronic Commerce encompasses those businesses offering products or services to either consumers or other businesses over the internet.

E-commerce can be broken up into two main categories:


   Online Purchasing: This business presents the customer with those technologies that make it easier for them to find data and buy commodities. The businesses encompassed in this category serve the customer by giving them the option of order placement, purchase order submission or requisition of quotes.

   Online Shopping: This involves businesses giving information to customers so that they can make a decision and buy a certain commodity from you.

To explain these two concepts lets say we go to XYZ.com and we are reviewing ABC product. When we are doing this, we are participating in Online Shopping. We then decide whether the commodity ABC is the right choice, you then add it to the shopping cart. After you have chosen whatever products we want, we then click the purchase button. As soon as we click the purchase button, we then participate in an online Purchase. This process involves all those secured pages that ask you for details such as credit card information, shipping details and other particulars.

e-Business or Electronic Business on the other hand, are those businesses that run the traditional way but also cater to the needs of online requests. An e-business status is received when  we can handle the calls, mail orders and the online activities.

Having said this,we will find that many sites although are related to e-commerce but are not e-businesses. E-commerce website only caters to selling of a commodity. Whereas an e-business has the companies activities amalgamated with the website. This means the marketing, accounting system, manufacturing, operations and other functions of the business is in contrast with the website activities.

2.     The term e-commerce is often described as outward process as it involves processes like reaching the customers, any external partner, external suppliers etc. On the other hand, e-business covers various internal processes like content management, risk management, inventory management, production management, finance management and other internal business processes.

3.     In practice, e-business usually includes e-commerce. E-commerce seeks to add revenue streams using the Worldwide Web or the Internet to build and enhance relationships with clients and partners and to improve efficiency using the Empty Vessel strategy. Often, e-commerce involves the application of knowledge management systems.

E-business is more than just e-commerce. It involves business processes spanning the entire value chain: electronic purchasing and supply chain management, processing orders electronically, handling customer service, and cooperating with business partners. Special technical standards for e-business facilitate the exchange of data between companies. E-business software solutions allow the integration of intra and inter firm business processes. E-business can be conducted using the Web, the Internet, intranets, extranets, or some combination of these.

4.     E-commerce principally involves money exchanges in the transactions. In e-business, as it is broader, it is not limited to monetary transactions. All aspects in business are included like marketing, product design, supply management, etc.

5.     E-business is more about making great products, brainstorming and giving quality service, planning about product exposure and executing it. Well, of course, e-commerce is an integral part of the e-business process but in strict terms, it is the activity of selling and buying

SUMMARY

1.     E-business is broader in scope and e-commerce is just an aspect or a subset of it.

2. E-commerce only covers business transactions such as buying and selling of goods and services   over the internet.
3. E-commerce essentially involves monetary trade while in e-business, money transactions are not necessary.
4. E-business involves marketing, product design, consumer service evaluation, and more.

POINT TO BE NOTED

Many companies have an eCommerce site but are not yet an eBusiness. eCommerce is the online selling component of a web site. eBusiness is the integration of a company's activities including products, procedures, and services with the Internet. We turn our company from a business into an eBusiness when we integrate our sales, marketing, accounting, manufacturing, and operations with our web site activities. An eBusiness uses the Internet as fully integrated channel for all business activities.

The following is an example of a company that has not yet become an eBusiness: we visit a retailer's web site and buy a shirt. When the shirt arrives it is in the wrong size. We decide to return the shirt at the store's retail outlet instead of mailing it back to the vendor. However, when we go to the store we are told that they cannot take returns from their web site. Since the web site is not integrated with the rest of their business activities this company is not yet an eBusiness. If the company had integrated their web site with their stores by providing access to their web site from within the store, by accepting exchanges for sales made online, and by training their people to support customers from/with their web site, they would be an eBusiness. eBusinesses do not consider the web site as a separate activity from their core businesses: The web site is integral to all activities at an eBusiness.

Companies who are performing Businesses to Business activities become eBusinesses when they integrate standard activities with their web site. A salesperson considers their web site a sales tool. When talking to a customer the sales person takes the customer to their web site to give product presentations, provides the customer with virtual tours of the newest products, or shows the customer how to use a tool that the customer can use to configure their products. The Marketing Department releases products on the website first, providing online product presentations, eLearning courses, and brochures. Customer Support uses the web site to host FAQ (Frequently Asked Questions), support chat lines, and moderate newsgroups. Purchasing uses the web to obtain prices on necessary components and place orders, and Shipping uses the web to schedule deliveries and notify customers of product arrival. Within an eBusiness every department within the company treats the web as an important tool they can use to move business ahead.

Is our company a business or an eBusiness? Most companies go through the following series of phases as they evolve from a business to an eBusiness.

·        Phase 0: A company doesn't understand how they can take advantage of the Internet.

• Phase 1: An outside company is hired to create a web site. The web site is static, containing little more than an on-line brochure. Employees rarely reference the site or update it with the latest information.

• Phase 2: The Company decides to integrate eCommerce on the site. Someone within the company is charged with placing product catalog on-line. Salespeople consider the web site a threat - not an integral tool to conduct business.

·        Phase 3: Everyone's internal Power Point presentations include Web Site initiatives. None of these initiatives have been executed.

• Phase 4. The company starts implementing initiatives. The web site responsibility moves in-house and is assigned to an important member of the Senior Staff.

• Phase 5: The web site becomes important to All of Senior Staff. Initiatives are implemented; employees are focused on using the web to conduct business. The company is becoming an eBusiness.