What is eCommerce?

“eCommerce” is the buying and selling of goods or services over the internet. This buying and selling is typically facilitated through a website specifically designed to handle the buying and selling, as well as the transfer of money between the parties.

The internet and eCommerce has turned the world of traditional retail upside down. Consumers can shop in their pajamas at home on different internet websites, and have those good shipped directly to their house. Global retail eCommerce internet sales reached 22 trillion in 2016 and are expected to reach 27 trillion in 2020.

What are the different types of eCommerce businesses?

When asking, “What is eCommerce?” you find that eCommerce businesses can be classified in several different ways with different customer and product models.

What can you sell?

eCommerce stores can sell almost anything that you can buy in “brick-and-mortar” retail stores. It is up to your imagination to find what you want to sell to your customer. 

Here is a general outline of the different types of things you can sell online:

Services Sales

This eCommerce model sells services to a user for a fee. An example is SEO and digital marketing services for clients. Poet Media or Brandgy are examples of SEO companies selling digital marketing services to clients.

Subscription Sales

This eCommerce model is based on automatic recurring subscription sales directly to the user. An example is a monthly investment newsletter or a data information service (like Bloomberg).

Digital Product Sales

This eCommerce model sells digital products to users. This can be in the form of a software as a service (SaaS) product, or an ebook for example. A great example is the Apple iTunes store.

Physical Product Sales

  • Retail Product Sales – Direct product sales to the customer that bypasses all intermediaries.
  • Wholesale Product Sales – product sales to other businesses (wholesalers) who then market and sell to the end customer.
  • Dropshipping Sales – product sales made by the eCommerce website to the customer that is then shipped directly from the manufacturer to the customer (seller holds no inventory)

Who can you sell to?

Selling to Businesses

“Business to Business” (“B2B”)

One business sells a product or service to another business to use. An example is a linen sales website for restaurants.

Selling to Consumers

“Business to Consumer” or “B2C”

A business sells a product or service directly to a consumer. An example is an domain resale website selling premium domains directly to a consumer.

“Consumer to Consumer” or “C2C”

A person sells an item directly to another person over the internet. This is typically done through an auction or classified site like eBay, Autotrader or Craigslist.

eCommerce is a great way to Generate Residual Income.

eCommerce as a business model has a Lever Rank of 60 and is a great way to generate residual income.  The reason for the high Lever Rank is that eCommerce businesses are very inexpensive to start and operate.

There are several great eCommerce platforms that provide tremendous amounts of education and support for new store owners, making starting an eCommerce store easy, even for people with no coding or web design background.