E-commerce basically is the use of Internet to transact business and digitally enabled commercial transactions between and among organizations and individuals involving information systems under the control of the firm it takes the form of e-business. It is a subset of e-business, is the purchasing, selling, and exchanging of goods and services over computer networks (such as the Internet) through which transactions or terms of sale are performed electronically. Contrary to popular belief, ecommerce is not just on the Web. In fact, ecommerce was alive and well in business to business transactions before the Web back in the 70s via EDI (Electronic Data Interchange) through VANs (Value-Added Networks). Ecommerce can be broken into three main categories: B2B, B2C, and C2C.
B2B (Business-to-Businesss): Companies doing business with each other such as manufacturers selling to distributors and wholesalers selling to retailers. Pricing is based on quantity of order and is often negotiable. This the largest form of e-commerce involving business of billions of dollars. In this form, the buyers and sellers are both business entities and do not involve an individual consumer. E.g. ChemConnect, Grainger.
B2C (Business-to-Consumer): This is one of the most common e-commerce segments of today. As the name suggests, this model involves businesses and consumers. In this model, online businesses sell to individual consumers. The basic concept behind this type is that the online retailers and marketers can sell their products to the online consumer by using crystal clear data which is made available via various online marketing tools. E.g. BarnesandNoble.com
C2C (Consumer-to-Consumer): This system facilitates the online transaction of goods or services between two people. There are many sites offering free classifieds, auctions, and forums where individuals can buy and sell through online payment systems like PayPal where people can send and receive money online with ease. eBay’s auction service is a great example of where person-to-person transactions take place every day since 1995.
Other categories of e-commerce:
Companies using internal networks to offer their employees products and services online–not necessarily online on the Web–are engaging in B2E (Business-to-Employee) ecommerce.
G2G (Government-to-Government), G2E (Government-to-Employee), G2B (Government-to-Business), B2G (Business-to-Government), G2C (Government-to-Citizen), C2G (Citizen-to-Government) are other forms of ecommerce that involve transactions with the government–from procurement to filing taxes to business registrations to renewing licenses.