What are the different categories of e-commerce?

Last Updated on Sep 25, 2024 by Nurul Afsar

Generally speaking, when most people think of e-commerce, they think of the purchase of goods or services by use of the internet. However, there is a more specific way to refer to the type of online transaction by the means of mentioning which e-commerce category the transfer falls under. There are six basic types of e-commerce — Business-to-Business (B2B), Business-to-Consumer (B2C), Consumer-to-Consumer (C2C), Consumer-to-Business (C2B), Business-to-Administration (B2A) and Consumer-to-Administration (C2A) — and all of them represent a different purchasing dynamic.

Business-to-Business (B2B)

B2B e-commerce refers to all electronic transactions of goods and sales that are conducted between two companies. This type of e-commerce typically explains the relationship between the producers of a product and the wholesalers who advertise the product for purchase to consumers. Sometimes this allows wholesalers to stay ahead of their competition.

Example: Business-to-Business (B2B) e-commerce involves transactions between companies, such as a wholesale supplier like Alibaba providing goods to retailers. Another example is Salesforce offering its CRM software to other businesses to manage their customer relations. Additionally, Intel supplying microprocessors to computer manufacturers like Dell exemplifies B2B interactions.

Business-to-Consumer (B2C)

Perhaps the most common form of e-commerce, B2C e-commerce deals with electronic business relationships between businesses and consumers. Many people enjoy this avenue of e-commerce because it allows them to shop around for the best prices, read customer reviews and often find different products that they wouldn’t otherwise be exposed to in the retail world. This e-commerce category also enables businesses to develop a more personalized relationship with their customers.

Example: Business-to-Consumer (B2C) e-commerce involves transactions between businesses and individual customers, such as Amazon selling products directly to consumers online. Another example is Netflix providing streaming services to individual subscribers. Additionally, Apple selling iPhones and other devices directly to consumers through its online store exemplifies B2C interactions.

Consumer-to-Consumer (C2C)

This level of e-commerce encompasses all electronic transactions that take place between consumers. Generally, these transactions are provided by online platforms (such as PayPal), but often are conducted through the use of social media networks (Facebook marketplace) and websites (Craigslist).

Example: Consumer-to-Consumer (C2C) e-commerce involves transactions between individual consumers, such as eBay facilitating auctions and sales of goods between users. Another example is Craigslist, where individuals can buy and sell items directly to each other. Additionally, platforms like Etsy allow individuals to sell handmade or vintage goods to other consumers.

Consumer-to-Business (C2B)

Not the most traditional form of e-commerce, C2B e-commerce is when a consumer makes their services or products available for companies to purchase. An example of this would be a graphic designer customizing a company logo or a photographer taking photos for an e-commerce website.

Example: Consumer-to-Business (C2B) e-commerce involves individuals selling goods or services to businesses, such as influencers offering promotional services to brands. Another example is freelance platforms like Upwork, where individuals provide specialized skills and services to businesses. Additionally, websites like Shutterstock allow photographers to sell their images to companies for commercial use.

Business-to-Administration (B2A)

This e-commerce category refers to all transactions between companies and public administration. This is an area that involves many services, particularly in areas such as social security, employment and legal documents.

Example: Business-to-Administration (B2A) e-commerce involves transactions between businesses and public administration or government entities, such as Accenture providing consulting services to government agencies. Another example is SAP offering enterprise software solutions for public sector management. Additionally, IBM providing IT infrastructure and support services to government departments exemplifies B2A interactions.

Consumer-to-Administration (C2A)

Another popular e-commerce category, C2A e-commerce encompasses all electronic transactions between individuals and public administration. Examples of this include taxes (filing tax returns) and health (scheduling an appointment using an online service.

Example: Consumer-to-Administration (C2A) e-commerce includes individuals paying taxes online through platforms like TurboTax, citizens applying for permits or licenses through government websites, and individuals submitting applications for government benefits or services online.

Business to Government (B2G)

Business to Government (B2G) e-commerce refers to the transactions conducted between businesses and government agencies. This category of e-commerce involves businesses providing goods, services, and information to government entities. B2G transactions can include everything from supplying office equipment to developing and implementing software solutions tailored to the specific needs of government operations. A significant aspect of B2G e-commerce is the bidding process, where businesses compete for government contracts through proposals and tenders. This sector often emphasizes strict regulatory compliance, transparency, and security due to the sensitive nature of government work. By leveraging B2G e-commerce, governments can streamline procurement processes, improve efficiency, and enhance transparency in public sector transactions. Businesses benefit from securing large, stable contracts and establishing long-term relationships with government agencies. This category of e-commerce is crucial for the modernization and efficiency of public sector operations.

Examples: Microsoft provides cloud services to government bodies, Lockheed Martin supplies military equipment to the Department of Defense, and Bechtel handles construction projects for public infrastructure. These transactions streamline procurement processes and enhance public sector efficiency.

Numinix web development has experience handling an assortment of e-commerce businesses!

Have you participated in more than one e-commerce category before? Tell us your preferred method in the comments section below.