E-commerce has been around for a long time. It started with Phil Brandenberger, a man who purchased the first online product – “Ten Summoner’s Tale” studio album from Sting in 1994. Twenty nine years later, in 2023, online commerce took over the market. It is estimated that e-retail sales worldwide will soon grow up to 6,5 trillion dollars. E-commerce is progressing so significantly that it may soon be serving 2.64 billion people.
It simply became an integral part of our life and a significantly more profitable business model than brick-and-mortar stores. This article will show you the most significant of online shopping, from a customer, as well as business point of view.
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What is E-commerce?
Other terms for e-commerce include electronic commerce, internet commerce, or online commerce. It refers to all activities that involvebuying or selling goods and services online. Simply, it has the same concept as brick-and-mortar stores, only all the transactions and interactionshappen through the internet. You can purchase various products, from clothes or sports equipment tosoftware solutionsand other services.
E-commerce does no longer happen mostly on laptops. Nowadays,mobile devicesare in the lead. This year, mobile commerce is expected to covermore than halfof all online sales activities.
Important note:Don’t confusee-commercewithe-business, since these two terms are not synonyms. E-commerce includes the transaction of products and services solely, while e-business covers all aspects of internet business operations.
E-commerce Models
#1B2C– Business to Consumer: We put this model first since it is the most popular one. In the case of B2C e-commerce, sales happen between business and consumer. For example, if you buy swimwear via Shein, you just made a B2C e-commerce purchase.
#2B2B –Business to Business: It defines a model where a business is selling either products or services to another business. CloudTalk counts as aB2B e-commerce modelsince we offersoftware solutions to other companies.
#3 C2B –Consumer to Business: Simple model. An individual person sells services or products to a company. Here, we can mention freelancers, such as writers, photographers, etc., but, for example, also social media influencers marketing, promoting branded products on their channels.
#4C2C –Consumer to Consumer: This model refers to one individual person selling a product or service to another individual person through the internet. For example via platforms like eBay or Etsy.
#5D2C –Direct to Consumer: The newest e-commerce model, where a brand sells directly to their end customer without going through distributor, wholesaler, or retailer. A popular example is subscriptions or selling via social platforms, such as Facebook, Instagram, or Pinterest.
Yet, in this blog, we will be talking solely about the first two models–B2C and B2B.
The Advantages of E-commerce For a Customer
E-commerce ensures customers can findeverything needed in one place, without a necessity to even get up from the couch. With approximately 26.5 million online stores worldwide, the options are virtually limitless. This is probably one of the greatest advantages of online shopping. Why walk among store shelves and search for products when all you need is acouple of clicks from you?
Here is our selection of the most significant advantages e-commerce brings to customers:
Choose From Wide Range of Goods
E-commerce allows customers tochoose a product or servicethey want, from any supplier, anywhere in the world. You have a much wider choice than in brick-and-mortar stores. And the freedom tobrowse digital catalogs without any stress or hurryis priceless.
You can also get abig variety of productssince there isno space limitationwith e-commerce. The traditional store has boundaries that allow it to offer only a limited quantity of goods.
However, e-commerce stores may have their limitations elsewhere. Although you can choose from a much higher number of products online than offline, it does not necessarily mean thatthe online product is actually in stock. If it isn’t, you have to wait for a few days.
Enjoy Simplicity and Comfort
Customers can buy any product from any e-commerce in the worldwithout having to leavetheir workplace or home. Due to bad weather, economic and health situations, or any other reason, many peoplecannot go shopping. A great showcase is a Covid19 pandemic when brick-and-mortar stores were closed for months.
E-commerce is convenient for buying goods or services withoutcreating physical limitations. It requiresjust a few clicksfrom the comfort of your home to gain the merchandise.
There is alsononeed for cash. You may simply fill in credit or debit card details and make an immediate payment.
Save Money
Products offered over the Internet aregenerally cheaperthan those in the shops. So, you can save your money. Costs incurred by aprovider of products or servicesin cooperation with an intermediary are paid by the customer. When there are no middlemen, the customer maynot have to spend that much.
Save Time
Saving time is one of the major benefits of e-commerce. Customers can orderanything you need online, even groceries to cook. E-shops are open24/7/365, so you can shop at any time. There is no issue with ordering in the evening or even during the night.
The period required to choose, buy, and pay for an online product is15 minutes or less. Products are often delivered within a maximum of one week, but it can be days or hours, depending on a sort of service. If you order goods that are heavier, the delivery person willbring them to your doorstep.
Get Detailed Information
The Internet is used as the main tool for makinge-commerce transactions. It allows customers to search for product information, compare prices and benefits and ultimately evaluate whether it is reallyworth the money.
Everything that you need for making an informed decision is literally there,on the tip of your finger– reviews from other users, tools comparing websites or prices, product descriptions, usage videos, etc.
There is alsowarranty informationthat contains product descriptions and other details. All customers therefore may befully awareof the conditions before purchasing the product. This way, a change of any dispute regarding guarantees or other mattersdrops to minimum.
To put it simply, with e-commerce, you can findall the product details onlinewhile goods that are physically located in the store may not have this option.
You can alsomodify their ordersonline andtrack the delivery status. If there is any doubt about product handling, you maycontact the company, for example through tools likeLive Chat.
Advantages of E-commerce For a Business
There are countless of them. From less financial investment to worldwide selling possibilities, e-commerce is a huge deal in the world of business.
Let’s go through the most significant benefits that online sales can bring to your company.
#1 Lower Your Costs
Saving finances is definitely one of the biggest benefits of e-commerce for any business.
When you open a brick-and-mortar store, you mayneedthousands of dollars. You pay for a space, a rent, maintenance, stock and various services. Not mentioning store signs, inventory optimization software, sales equipment, store design, etc. Many times, the costs are so high that it simplydoesn’t pay backthe money you invested. If you don’t receive enough profit, there is noROI.
E-commerce stores don’t require any of the above mentioned items. It needssignificantly less investment, which makes online sales a great opportunity also for individuals and small scale sellers. If you are just starting with e-commerce, you can use hosted solutions, such asHubspot, Shopify and Squarespacetocreate an e-commerce website. All functions are already there, you just need to customize the information. The best e-commerce hosting is reliable, easy to use, and capable of matching your budget. If you want to build a website from scratch, don’t forget to utilize usability testing tools to ensure a seamless user experience and website accessibility.
Alower need for staff membersis another benefit of e-commerce that saves money. You can sell by yourself or, if you need help, here comes additional advantage – all your employees canwork fully remotely. That makes it easier to find talents, since they can be located wherever.
#2 Use Affordable Marketing
With e-commerce, businesses save a significant amount of money and time onadvertising. No need for printed catalogues. Thanks to the advantages of online shopping, you cantruly show off your product– easily, quickly, creatively and affordably. For example, via email marketing, website videos, pictures, infographics, Google Adwords or social media – either through free organic posts or through paid advertising.
Also,branding is more affordable with e-commerce. Online, your logo can be made by yourself or a professionalgraphic designer, yet it’sstill cheaperthan manufacturing an actual physical logo.
You may consider using a QR code in your logo. Quick Response code can store practically any data for example a link to your website.. Simply by scanning the QR code with their smart devices, your customers will be routed wherever you send them.. All you need is to look for the best dynamic QR code generator.
#3 Collect Customer Data Insights
If businesses wish to achieve an exceptional customer experience, they simplyneed customers’ data. It reveals all their likes, dislikes and needs in order to tailor the best products, services, campaigns, or evenexceptional e-commerce customer support.
Online world is agoldmine of data insightsthat you would never get in brick-and-mortar stores. During purchasing or subscribing to promotional materials, customers provide their name, phone numbers, email addresses, demographic data and more. You may thenanalyze these datain analytical tools, such as Google Analytics or HubSpot.
This accumulated information can also help withretargeting advertisingto attract leads who haven’t purchased yet, or to email potential customers that left your store before purchasing, reminding them that their “shopping card” is full.
Note:Even though e-commerce generates an incredible amount of useful data, you should alwaysact ethicallywhile collecting them. Don’t forget to keep aGDPRin mind. And if you collectsensitive data, do your best to protect it.
#4Reach New Customers
Even if they don’t always purchase, around87 %of peoplestart their shopping journey online. They are browsing, reviewing prices, comparing different services and so on. These are all yourpotential customers.
While brick-and-mortar shops are more or less tight to their location, in case of e-commerce stores,no geographical borders apply, which significantly widens a number of business leads. You can sell to anyone in the world,by a single clickon your website.Therefore, it’s crucial to ensure your website is secure by choosing the right hosting solution and using penetration testing services to ensure the same. Hosting helps to ensure your content is secure and reliable when it reaches your customers.
Businesses may also usedifferent channelsfor reaching out to a unique audience, also known as community outreach. On social media, you have a chance to find a whole new demographics.One of the best ways to accomplish this is through Instagram marketing.These leads would probably never reach your business through a search engine, because they are not actively looking for your product, but they may do so afterdiscovering you on social media.
#5Make It Easy To Scale Up
A huge benefit of e-commerce –an online store never closes. That allows the profit to rise constantly. It also provides an opportunity to reach those who aretoo busy to shop in normal store opening hours.
Selling online non-stop issimple. Even though your human customer service agents may be sleeping,sales automationassures that your store works24/7/365. Any day and any time a customer makes a purchase, automation software sends a confirmation email about placing the order.
Disadvantages Of E-commerce
Although it may seem like the ideal way to get what you need, e-commerce also has itsdisadvantagesthat can discourage the buyer,such as:
- Impersonal approach:The customer does not communicate with the seller face to face, which may cause doubts or distrust. Some customers are therefore more cautious when buying over the Internet and prefer personal contact. That way, they can talk to the seller, see the goods, touch them or try them on.
- Additional costs:Another disadvantage of online shopping may be that customers often pay for customer shipping or packaging.
- Longer waiting time:As we mentioned, shopping online means waiting. Customers cannot “walk into” the online store and take the product immediately, as it is in the case of brick-and-mortar shops. Waiting time can take days, but it may also be several weeks, if the product is not in stock.
- Uncertainty:If consumers fall into a trap of unreliable sellers, they can get a product that doesn’t match their order or even not receive it at all. Customers may therefore be concerned whether e-commerce is safe.
Just be cautious. If you do business with well-established e-shops and find all information before you make an order, all shortcomings will be eliminated and you will enjoy only the benefits.
