Today, eCommerce is something that any business is eager to master.
It does not matter at all whether you are creating a new business or already have a successful offline enterprise. It is worth noting that the popularity of eCommerce is so great that the world economy has formed a separate industry for it.
Approaching the issue of launching eCommerce, one is faced with choosing a business model. The most important thing in this matter is an individual approach. One should choose the one that best suits your level of experience, budget, the time you have, and the tasks that are set.
That’s why every time you choose a business model, we recommend turning to the professional team at Sturppy where you’ll find that very special and personalized approach to the matter. After all, you can have a great product, find a reliable supplier and use smart marketing.
However, if you do not have a good basis for business, it is unlikely to succeed in launching a successful eCommerce business. So let’s take a quick look at what an eCommerce business model is and examine the four most popular ones that exist.
The eCommerce business model: what is it?
Walmart, Apple, and Amazon are all examples of successful eCommerce that are known around the world.
Moreover, it is almost certain that you are reading this material through a gadget created by the second-named giant in this field. How did these businesses become so widespread? To answer this question, we need to understand what the eCommerce business model is.
eCommerce business model is a kind of plan, which keeps in focus the monetization and sale of a variety of goods and services, using the most accessible tool – the Internet.
There are many ways to carry out this activity, from banal trading through social networks to the multi-level models used by huge corporations. The most commonly used business models have several structures.
For example, they may be based on selling directly to the consumer, selling to other companies, and providing digital services.
The main thing in all this is not to confuse eCommerce with digital marketing. The former involves transactions, which are carried out on the site. Marketing, in turn, has all forms of Internet communication.
Characteristics of the main business models in eCommerce
Now we are going to talk briefly about the most commonly used models.
However, there are many more. Unfortunately, not all of the subtleties are available from public sources. This is where the team at Sturppy comes in to help, explaining the intricacies of choosing and using business models on their fingers.
And we’ll go on and talk about the four main ones:
It is based on a model of selling goods directly to the consumer.
This option is suitable for those companies in which goods and services are primarily focused on people. Thus, the potential customer comes to your website and already then determines whether your product is able to satisfy his need.
Such a model often resorts to the methods and techniques of digital commerce. What are the benefits of using this model? You can count on a customer base that is virtually inexhaustible. In addition, your potential for sales and profits will be really great.
But, there is also quite serious competition and you will have to constantly work to win the favor of customers.
Business for business
Here the scheme is different and involves the sale of goods and services to other companies. Most often, businesses that choose this option, sell expensive and incredibly high-quality products.
In this case, it is not the company’s task to sell the goods and services it creates to the end consumer. It only resells it all to other companies that are already in the business of selling to the consumer.
This model implies making deals on large orders, reducing the number of transactions, and shortening cycle times. However, it’s worth realizing that your customer base will be small. In addition, your customers will be very demanding of the products manufactured.
Consumer – business
Popular mainly due to platforms that focus on freelancers. The latter work on tasks, and clients are most often commercial organizations. Freelancers are, for the most part, individuals. Thus, the consumer-business model is a sole proprietorship that serves large businesses.
An example of this interaction can also be social networks. Using this model you can get a huge opportunity to increase brand awareness. Advertising in this case will be very cheap. But, to get any stable results from this business will be difficult.
In this case, even the influx of advertising will be difficult to predict.
Reverse auction sites, freelance marketplaces, and affiliate marketing are all part of this business model. In addition, when using the model, you need to understand that it requires detailed planning, taking into account all the legal specifics of the country.
The consumer – the consumer
Here the consumer sells the goods further to another consumer. This variant helps to expand the customer base.
Thus, the cost of production is practically absent. The platform, on which the bidding is carried out, receives a small commission, and at the expense of this, it functions. A very tempting option, but here one may run into fraudsters and fabulous competition.