At its core, electronic commerce or e-commerce is simply the buying and selling of goods and services using the internet, when shopping online. However, the term is often used to describe all of a seller’s efforts, when selling products directly to consumers. It starts when a potential customer learns about a product and continues through purchase, use, and, ideally, ongoing customer loyalty.
In the 1990s, retailers discovered a new way to conduct business—the internet. At its core, electronic commerce or e-commerce is simply the buying and selling of goods and services using the internet, when shopping online. However, the term is often used to describe all of a seller’s efforts when selling products directly to consumers online. It starts when a potential customer learns about a product and continues through purchase, use, and, ideally, ongoing customer loyalty.
Data powers the most successful e-commerce operations, which take advantage of best practices such as targeted email marketing, audience segmentation, and marketing automation. For example, following up with a customer after they have placed an item in an online shopping cart but didn’t complete the transaction can significantly increase your likelihood of making the sale.
What is an eCommerce website?
An e-commerce website, simply put, is an online store. It’s a platform where goods and services are traded between buyers and sellers over the internet. Unlike a physical storefront, an e-commerce website can be accessed at any time, from anywhere, as long as there’s an internet connection. As a digital shopfront displays products or services, allows users to select and purchase them and facilitates the acceptance of payments.
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Pros of e-commerce:
The benefits of e-commerce include its availability, accessibility, speed of access, selection of goods and services and international reach.Pros of e-commerce explains best e-commerce website development company
- Low startup and operating costs: Starting an e-commerce business is generally much cheaper than starting a brick-and-mortar store because there’s no rent or real estate costs, and you can start with fewer employees.
- Offers flexibility: E-commerce is a more flexible solution for businesses and their customers because customers can shop at any time of day, from anywhere.
- Easy to engage in data-based marketing: Your e-commerce store can provide you with a trove of marketing data through analytics and reports to help you make better decisions when promoting your business.
- Wide selection of available products: E-commerce offers a wider variety of available products for customers as opposed to brick-and-mortar stores, which can only hold so much inventory in the physical space they occupy.
- Around-the-clock availability. Aside from outages and scheduled maintenance, e-commerce sites are available 24/7, enabling visitors to browse and shop at any time. Brick-and-mortar businesses tend to open for a fixed number of hours and even close entirely on certain days.
- Speed of access. While shoppers in a physical store can be slowed by crowds, e-commerce sites run quickly, depending on compute and bandwidth considerations of both the consumer device and the e-commerce site. Product, shopping cart and checkout pages load in a few seconds or less. A typical e-commerce transaction requires a few clicks and takes less than five minutes.
- Wide selection. Amazon’s first slogan was “Earth’s Biggest Bookstore.” It could make this claim because it was an e-commerce site and not a physical store that had to stock each book on its shelves. E-commerce enables brands to make an array of products available, which are then shipped from a warehouse or various warehouses after a purchase is made. Customers are likely to have more success finding what they want.
- Easy accessibility. Customers shopping in a physical store might have difficulty locating a particular product. Website visitors can browse product category pages in real time and use the site’s search feature to find the product quickly.
- International reach. Brick-and-mortar businesses sell to customers who physically visit their stores. With e-commerce, businesses can sell to anyone who can access the web. E-commerce has the potential to extend a business’s customer base.
- Lower cost. Pure play e-commerce businesses avoid the costs of running physical stores, such as rent, inventory and cashiers. They might incur shipping and warehouse costs, however.
- Personalization and product recommendations. E-commerce sites can track a visitor’s browsing, search and purchase histories. They can use this data to present personalized product recommendations and obtain insights about target markets. Examples of how such insights are used include the sections of Amazon product pages labeled “Frequently bought together” and “Customers who viewed this item also viewed. trainer to help fix your dog’s troublesome barking habit, there’s no shortage of assistance available online.
- Digital products: Digital products—like online courses, software, podcasts, music, and e-books—are becoming increasingly popular on e-commerce sites as well. The rise of digital products has opened up a new way to learn skills on demand
Cons of e-commerce:
The perceived cons of e-commerce include sometimes limited customer service, consumers not being able to see or touch a product prior to purchase and the wait time for product shipping. Security issues can also be a problem.Cons of e-commerce is explained by best ecommerce website development company
- Less connection with customers: Because there’s nobody to interact with when shopping, customers may feel less of a connection with your business. The customers also won’t get the opportunity to touch the product before buying it to ensure it’s what they really want.
- Requires more coordination for shipping logistics: E-commerce customers can be anywhere in the world, so business owners must ensure their shipping and logistics can get products to their destination in a timely manner. Customers will also have to wait to receive their products.
- Minimal customer service: Many e-commerce stores lack the presence of a customer service representative available to customers at all times to answer questions and resolve issues.
- Limited customer service. If customers have a question or issue in a physical store, they talk to a clerk, cashier or store manager for help. In an e-commerce store, customer service can be limited. The site might only provide support during certain hours and its online service options might be difficult to navigate or not able to answer specific questions.
- Limited product experience. Viewing images on a webpage can provide a good sense of a product, but it’s different from experiencing the product directly, such as playing a guitar, assessing the picture quality of a television or trying on a shirt or dress. E-commerce consumers can end up buying products that differ from their expectations and have to be returned. In some cases, the customer must pay to ship a returned item back to the retailer. Augmented reality is expected to improve customers’ ability to examine and test e-commerce products.
- Wait time. In a store, customers pay for a product and go home with it. With e-commerce, customers must wait for the product to be shipped to them. Although shipping windows are decreasing as next-day and even same-day delivery becomes common, it’s not instantaneous.
- Security. Skilled hackers can create authentic-looking websites that claim to sell well-known products. Instead, the site sends customers fake or imitation versions of those products — or simply steals credit card
- information. Legitimate e-commerce sites also carry risk, especially when customers store their credit card information with the retailer to make future purchases easier. If the retailer’s site is hacked, threat actors may steal that credit card information. A data breach can damage a retailer’s reputation.
Types of e-commerce sites
The scope of e-commerce is vast, but the types of sites that host electronic transactions can be broken down according to the parties involved.
- Business-to-consumer (B2C): Probably the most familiar to the average person, a B2C site enables an exchange of goods or services between a business and a consumer, such as buying a T-shirt from your favorite online shop.
- Business-to-business (B2B): A B2B platform facilitates electronic transactions between two businesses. If you own a company that sells T-shirts, for example, you might buy those shirts from an online wholesaler.
- Business-to-administration (B2A): A B2A site facilitates electronic exchanges between an organization and a public institution, like the website of a company that designed your city’s web portal, for instance.
- Consumer-to-consumer (C2C): A C2C site, often known as a marketplace, hosts an exchange of goods between 2 or more consumers. Examples include websites like Etsy and eBay.
- Consumer-to-business (C2B): On a C2B site, individuals offer goods or services to businesses. This could be a freelance SEO expert who works with companies in a certain industry or an influencer paid to promote a company’s products.
- Consumer-to-administration (C2A): Similar to B2A, this type of site allows a consumer to provide information, goods, or services to public administration and governmental organizations—think paying a parking ticket on your city’s web portal.
eCommerce website examples
To give you a clearer picture of what an eCommerce website is, here are some examples:
- Amazon: A giant in B2C sales that offers everything from books to electronics.
- Alibaba: A leading B2B platform connecting manufacturers with retailers.
- eBay: A popular C2C marketplace where individuals can auction and sell items.
Each type serves different market needs and requires specific business strategies for success.
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Types of products sold via e-commerce
The digital component of e-commerce allows sellers to offer a wide range of products, some of which wouldn’t be possible to sell in a physical location.
- Physical goods: Items such as clothing, furniture, food, or supplies are tangible products that can be stored in a warehouse. Sellers display goods on their e-commerce website, where consumers can like, save, or purchase them. Upon purchase, the business ships the item to the customer.
- Services: E-commerce sites are also a popular way to sell services, like consultations, maintenance, tutoring, lessons, and more. Whether you want to learn to code a website or you’re looking for an experienced
What should your e-commerce site do?
When it comes to selling goods and services online, there are a few basic functions every e-commerce site should include.
Accept orders
- Record customer information (name, address, etc.)
- Collect customers’ acceptance of your terms of service
- Calculate any applicable taxes
- Apply coupons or discounts
- Generate order and tracking numbers
- Share delivery details
- Process billing information
- Provide access to a payment gateway
E-commerce platforms and vendors
An e-commerce platform is a tool that’s used to manage an e-commerce business. E-commerce platform options range in size from ones for small businesses to large enterprises. They include online marketplaces, such as Amazon and eBay, that simply require signing up for user accounts and little to no IT implementation.
SaaS is another e-commerce platform model. Business owners subscribe to a service where they essentially rent space in a cloud-hosted service. This approach doesn’t require in-house development or on-premises infrastructure. Other e-commerce trends include opensource platforms that require a cloud or on-premises hosting environment or complete manual implementation and maintenance.
Examples of e-commerce marketplace platforms include the following: Alibaba, Amazon, Chewy, eBay, Etsy, Newegg, Rakuten, Walmart Marketplace and Wayfair. Vendors offering e-commerce platform services for clients hosting their own online store sites include the following: Adobe Commerce, BigCommerce, Ecwid, NetSuite Commerce, Salesforce Commerce Cloud, Shopify, Squarespace and WooCommerce.
Personalization
E-commerce platforms enable personalized shopping experiences through features like product recommendations, targeted promotions and personalized content based on customer preferences and behavior.
Start with a user-friendly platform like WordPress.
You’ll have a lot to do and learn in your first few months, which will eat up a lot of your time.
That’s why in the beginning, WordPress or a similarly flexible e-commerce platform is a good option. Once you’ve established your business and gotten some e-commerce experience, you’ll have a clearer idea of what you need and have plenty of time to shop around for another solution if necessary.
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