One of the big questions about e-commerce today is: what are the two main kinds of e-commerce? And, what are they used for and how do they work? The answers to these questions will not only help you understand the future of e-commerce but also change the way you look at the world of online business.
E-commerce is simply defined as using the Internet and electronic devices to do business. In its most simple form, this means using the Internet to “sell” products and services. This is a pretty broad definition, but it covers a lot of ground. For instance, say you want to start a gift shop. Well, if you were to describe your gift-shop operation in terms of an e-commerce site, then you’re in a bit of trouble because it would be difficult to define exactly what those words mean.
So, we’ll assume that we’ve defined our market in terms of gift shops. What are the two main types of e-commerce then? Well, first of all, there’s the physical store. This type of e-commerce is pretty easy to figure out – if you have a lot of space available and you’re willing to put up a store, then you can go ahead and start marketing to potential customers.
The problem here, of course, is that you have to actually have some sort of physical store in order to have this type of e-commerce. It would be much easier, however, if you had the ability to have a website – a domain name and a hosting service and a little bit of web programming. You’d be able to set up a shopping cart and have access to a “product catalog” so that you could actually see what items you’re going to sell. But, of course, this is something that very few people have the know-how for.
The second main type of e-commerce is a “virtual” store. Basically, when you have an online store, you don’t actually own the actual building where your business is physically located. Instead, you rent space on some server farm and manage the things that happen in that space through a web interface. In this case, you still want to have a market definition so that you know exactly what products you’re going to sell, but with virtual stores, you can literally outsource the administrative stuff to someone else.
So, now we come to the final definition of e-commerce. Basically, it’s simply the method of selling products over the Internet. It doesn’t matter whether you’re selling individual items or a complete suite of services, as long as you have a market definition and you can define your products using basic html. All you need to do is post the products on an auction site and let customers bid on them to purchase them. In this way, e-commerce is much like the traditional retail model – except it doesn’t require brick-and-mortar stores.