Is eCommerce Applicable in All Types of Business? A Detailed Analysis

Many people equate eCommerce with online shopping, but that is a very narrow definition. At the highest level, eCommerce is a business model that supports the buying and selling of things (products or services) over the Internet. Broken down further, there are 5 types of eCommerce: business to business (B2B), business to consumer (B2C), business to government (B2G), and the lesser known consumer to consumer (C2C) and consumer to business (C2B).

Global B2C eCommerce sales amounted to nearly $3.53 trillion in 2019, with pre-COVID figures expected to nearly double by 2023. However, COVID has injected massive growth into eCommerce sales, accelerating the shift to eCommerce by as much as five years. As we near the end of 2020, eCommerce retailers have been breaking records for sales across the board, from a 20% increase at Office Depot to a 79% increase at Walmart.

“The COVID-19 pandemic is having a seismic shift on the retail industry, and its effects are likely to be permanent,” notes Xian Wang, Global Content Director at Edge by Ascential in the Future of Retail Disruption 2020/21 Report, “We have seen a dramatic shift towards digital commerce, with 40% of global retail sales projected to come from ecommerce by 2024.”

While this retail eCommerce growth is remarkable, eCommerce growth is not isolated to the B2C sector. Earlier this year, Frost & Sullivan forecast that B2B eCommerce sales would reach over $6.6 trillion this year, a figure nearly double the B2C estimate. The US alone will account for over $1.9 trillion in B2B sales in 2020. When we look at B2G, the US government spends $8.5 billion a day in products and services.

All of this begs the question: does eCommerce apply to all types of business? Let’s take a look.

How eCommerce Applies in Different Sectors

eCommerce for B2C Businesses

When we think of eCommerce, we are usually thinking of a business-to-consumer (B2C) relationship. As we have all adapted to the global pandemic, online purchasing has become nearly second-nature across many sectors from household goods and fashion to electronics and everything in between.

The B2C eCommerce marketplace is very well established, with dozens of well-established off-the-shelf platforms allowing B2C retailers to get up and running quickly.

Trends Impacting Customer Acquisition Costs for B2C Retailers:
1. Changes to the Google Search Engine Results Page (SERP)
2. Social Platform Silos
3. Increased Ad Costs
4. Competition
5. Consumer Expectations
Read More

Most organizations rely on monolithic eCommerce architecture: a single solution takes a customer from their site visit to their purchase. However, customers today are coming to omnichannel vs multichannel retail with high expectations that not all eCommerce platforms are able to meet.

The B2C eCommerce is evolving with a new option: “headless” eCommerce. In this model, retailers are decoupling the front-end website from the backend to offer a greater level of customization, personalization, and adaptability.

Traditional vs Headless Commerce

Augmenting the High Street With eCommerce

When we talk about traditional retail, the traditional “brick-and-mortar” retail environment is referred to as the “high street.” In recent years, particularly during the COVID-19 pandemic, we are seeing a blurring of lines between traditional retail and eCommerce. Many retailers have begun offering “click and collect” sales options (from Starbucks to grocery, restaurant and even apparel), with the trend resulting in a 12% increase in purchase frequency and a 10% boost in basket size in 2020. These eCommerce platforms (mobile websites and apps) facilitate sales without the need for shipping.

Omnichannel Retailing

Most retailers today are multichannel: they sell products across many different channels, whether retail, online, or mobile. Each channel is its own silo with different stock and different customer service teams. For example, in a multichannel framework, an item purchased online cannot be returned in-store. In another instance, an in-store buyer is given a coupon on their printed receipt that must be presented during their next in-person visit.

Omnichannel vs Multichannel

Omnichannel frameworks share one inventory and customer support experience. An omnichannel shopper can use their mobile device to check stock for a particular store, check past in-store and online purchases, or confirm loyalty points. An omnichannel shopper can also buy a product directly on Pinterest without being redirected to another check-out site.

Today’s consumers interact with brands across a mix of channels, making it important to track data across the entire customer journey in order to personalize future interactions in real-time, no matter the channel they are using at the moment.

Headless Commerce

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eCommerce for B2B

Business to business (B2B) eCommerce revenue is growing rapidly, accounting for half of all B2B revenue and accounting for the largest area of eCommerce growth in the next 5 years. B2B purchase decisions are not as immediate as those of a B2C purchase, with a typical B2B buyer conducting an average of 12 online searches before making a purchase. This B2B buyer is also most likely a Millennial (age 24-39 in 2020), an age group that prefers digital and who bring with them high expectations for the eCommerce experience.

Increase in online purchase for business buyers

B2B companies must deliver the content, features and experiences that their buyers expect from their daily lives as B2C consumers. ~ Accenture Interactive

As a result of this focus, a current 55% of the B2B marketing budget is focused on the digital experience on the eCommerce website. Brands are investing in content marketing efforts, personalization, self-service, and interactive features such as ROI calculators or video chats. Carefully structured eCommerce sites are giving businesses new ways to target key decision-makers in precise ways.

eCommerce for Government

Business to government (B2G), also known as business-to-administration (B2A), is a larger market than many realize, with spending by the public sector at the local, state, and federal level. The US federal government alone spende about $8.5 billion per day on goods and services. At the Global level, government IT spending in 2020 totaled $438 billion, representing 16% of all enterprise (B2B and B2G combined) IT spending.

Although the private sector mostly supplies the government through a formal request for proposal (RFP) bidding process, eCommerce is becoming increasingly relevant. eCommerce in the B2G sector works in the reverse of most other sectors with the government supporting the eCommerce platform to put projects out for tenders and applications and to facilitate the ongoing exchange of information. In this scenario, there is a great deal of pressure for eCommerce solutions that keep data secure.

eCommerce for C2C and C2B

In the consumer to consumer (C2C) and consumer to business (C2B) models, the consumer acts as the seller of the good or service but also as the consumer of the third-party eCommerce platform.

Consumer to Consumer Commerce

Online marketplaces such as Craigslist, Ebay and Facebook Marketplace are examples of C2C eCommerce. In these examples, Craigslist, Ebay and Facebook are intermediaries providing the eCommerce platform for the buying and selling of products between consumers. The C2C marketplace provides sellers with a way to get their products on the marketplace with no up-front investment in their own eCommerce solution or retail store.

In the C2B model, we have end users (consumers) creating products or services for the business market. The C2B model is very common in the job market, with sites such as Upwork allowing consumers to advertise their own skills for hire by businesses. Affiliate marketing (where a website owner includes an affiliate link to an eCommerce website in a post) is another example of C2B eCommerce, as the writer is compensated for facilitating a sale.

Consumer to Business Commerce

Does eCommerce Apply to All Business Types?

Let’s circle back to our earlier question: does eCommerce apply to all types of business? The answer is yes. Whatever your type of business relationship we’re trying to facilitate – B2B, B2C, or B2C, or C2B – eCommerce is stepping in to facilitate the sale. Across the board, a superior digital experience is the key to facilitating the sale.

What kind of eCommerce solution is right for you? Net Solutions has two decades of experience building strategic commerce apps and platforms that generate results. We understand all the elements that go into a successful eCommerce strategy, from branding and storytelling to design, optimization, and technology. We can optimize ready-made platforms like Magento and WooCommerce as well as create custom digital experiences.

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Ashish Sangar

About the Author

Ashish is a thorough marketing professional, currently working with Net solutions as an Enterprise Account Manager. He plays a critical role in helping enterprises to improve their business performance and re-strategizing customer experience gaps, and understand the implications of new technologies and strategies to adopt them. He loves to utilize his time by delivering value to his customers by identifying different revenue streams and value propositions for them.

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