The word E-commerce is derived from electronic commerce. The term incorporates buying and selling of any sort of good or service using an electronic channel, it can be mobile or laptop, calls, websites or different apps. E-commerce is a vast and emerging industry. Many companies are considering the essence of e-commerce marketing to experience a rise in regular sales. Therefore, it can be stated that the e-commerce market will become the biggest trend in the coming years.
If you are analyzing your company’s financial statements and wondering for an increase in targeted sales for the next quarter, this is the best time to invest in e-commerce marketing. No matter what your business model is, e-commerce offers all services to the relevant market. However, it only requires a deep understanding of your current business model and your long-term plans. It is then possible to select the best model and strategy for setting up an e-commerce store.
Generally, FMCGs are more interested in setting up an online e-commerce store, however, the trends are rapidly changing due to COVID-19. More businesses are emerging and some existing ones are transforming to provide needful services in this pandemic. It is a great marketing strategy to earn and serve customers based on a need basis. For instance, in some countries like Pakistan, Uber has offered a delivery service for all grocery items that are required by its users. This ensures, the existing users about their service quality, their values, and branding while helping the load on their revenue stream.
Furthermore, it can be stated that an e-commerce business model varies depending upon the type of business or the product sold. It also depends on the target market and the platform where they are sold on.
The type of products being sold are
- Physical Product
- Digital Product
A physical product is also known as a tangible product that is delivered to the final customer in a packed form e.g. a dress, a makeup kit or a food item. Many FMCGs are using e-commerce to sell their products online to increase their overall reach along with sales. For some companies, it becomes difficult to manage their e-commerce marketing as well thus they end up hiring ane-commerce digital marketing agency.
Service-oriented businesses can also sell their services online using e-commerce platforms. Such businesses providing intangible services like UBER, and freelancing can also market their skills online on different sites where they can get hired or increase their annual sales. Thus, e-commerce is not limited to products-based businesses only.
A digital product is an output provided by a business that is not physically present but can be utilized digitally, for instance, an E-Book, or a game. Netflix is a popular example of an online e-commerce store where everything including the payment process is conducted digitally. This highlights a booming trend for the coming years.
Thus, the e-commerce business model for any company is dependent on its product category. Similarly, the target market is also an important factor in determining the model type which in this case is as follow
B2B refers to business to business. Sometimes, it is not probable that the company is directly selling off its products or services to the end-users. Sometimes, companies sell their services online to other businesses like a digital marketing agency. A digital marketing agency offers its valuable expertise to all those firms requiring marketing assistance and for that, the digital agency can set up a website for its e-commerce digital marketing service. This helps in targeting more clients at a time with one channel.
A B2C channel is widely known as business to customers, where a company directly sells off its products and services to its final customers. Hence, influencing its e-commerce business model type. For instance, an online shopping store or portal might set up an app or a web for displaying and selling multiple items at a time to its customers which a B2B company would not refer to as its e-commerce business model.
Finally, an e-commerce business model can be dependent on the type of platform the products or services are sold off.
- Company’s Online Store
- 3rd Party Stores
- Social Media
Company’s Online Store:
Big established firms cannot rely on third party sites for selling their products hence they prefer differentiating their brand name. For such businesses, e-commerce portals like Shopify are developed where they can update and monitor their inventory and sales details confidently.
3rd Party Stores:
Small businesses that do not have much to offer or cannot set up an individual online store can market and sell their products on other top e-commerce sites like, eBay or Etsy. It helps them in reaching more traffic and converting them into potential clients.
Another hot trend for 2020 is social media marketing and social commerce as FB shop and Instagram direct buying features are creating hype for top brands to sell products from their social pages. This e-commerce trend is more profitable where customers can also interact easily.
Hence, it can be concluded that e-commerce is a growing trend with lots of innovation coming side by side. Most businesses are using e-commerce models to sell products while others should consider it with increasing global demand and new trends.