Types of E-Commerce

Today electronic commerce is fast changing the way firms do business. Every firm who wants to sustain are reinventing themselves and their business models to find out innovative ways to leverage upon the power of the web. No industry or sector is being left out in this innovation and disruption. So what are the various e-commerce models which are striking out in today’s business?

Five major types of e-commerce are :

Business-to-Consumer (B2C) E-commerce: The most commonly discussed type of e-commerce is Business-to-Consumer (B2C) e-commerce, in which online businesses attempt to reach individual consumers. Even though B2C is comparatively small, it has grown exponentially since 1995, and is the type of e-commerce that most consumers are likely to encounter. Within the B2C category there are many different types of business models.

Business-to-Business (B2B) E-commerce: Business-to-Business (B2B) e-commerce, in which businesses focus on selling to other businesses, is the largest form of e-commerce, with over $1.5 trillion in transactions in the United States in 2005. There was an estimated $13 trillion in business-to-business exchanges of all kinds, online and offline, in 2002, suggesting that B2B e-commerce has significant growth potential (eMarketer, Inc., 2003). The ultimate size of B2B e-commerce could be huge. There are two primary business models used within the B2B arena: Net marketplaces, which include e-distributors, e-procurement companies, exchanges and industry consortia, and private industrial networks, which include single firm networks and industry-wide networks.


Consumer-to-Consumer (C2C) E-commerce: C2C provides a way for consumers to sell to each other, with the help of an online market maker such as the auction site eBay. In C2C e-commerce, the consumer prepares the product for market , places the product for auction or sale, and relies on the market maker to provide catalog, search engine, and transaction-clearing capabilities so that products can be easily displayed, discovered, and paid for.

Peer-to-Peer (P2P) E-Commerce: P2P technology enables the Internet users to share files and computer resources directly without having to go through a central Web server. In P2P’s purest form, no intermediary is required, although in fact, most P2P networks make use of intermediary “super servers” to speed operations. Since 1999, entrepreneurs and venture capitalists have attempted to adapt various aspects of P2P technology into P2P e-commerce. To date there have been very few successful commercial applications of P2P e-commerce with the notable exception of illegal downloading of copyrighted music.

Mobile Commerce (M-commerce): Mobile commerce, or m-commerce, refers to the use of wireless digital devices to enable transactions on the Web. M-commerce involves the use of wireless networks to connect cell phones, handheld devices such Blackberries, and personal computers to the Web. Once connected, mobile consumers can conduct transactions, including stock trades, in-store price comparisons, banking, travel reservations, and more. Thus far, m-commerce is used most widely in Japan and Europe (especially in Scandinavia), where cell phones are more prevalent than in the United States; however, as discussed in the next section, m-commerce is expected to grow rapidly in the United States over the next five years.