What is Ecommerce?



Ecommerce refers to the process of buying and selling products using the Internet as a medium. The term also covers business transactions, which typically consist of the exchange of value (eg. monetary means, information) between organizations or individuals in return for products or services.

The first safe purchase online was done through the retail platform NetMarket on August 11, 1994, which is considered the beginning of ecommerce. Since then, many online marketplaces and retailers, such as Alibaba, Amazon, and eBay, have increased the number of products to purchase online faster and simpler. Apart from that, the development of marketplaces allows customers to shop e-commerce sites globally with international delivery and minimized expenses. 

There are 4 major types of eсommerce Business Models:

  1. Business to Business (B2B), when one business sells products to other businesses in bulk (for example, Flexfire LED, CleanAir)
  2. Consumer to Consumer (C2C), which is the process of reselling previously bought products between consumers through marketplaces (for example, StockX, eBay)  
  3. Business to Consumer (B2C), where businesses sell products in small amounts to individuals ̣(for example, BestBuy, Costco) 
  4. Consumer to Business (C2B), which includes an individual providing his/her services to a certain organization (for example, artists, freelancers, photographers)

Application of ecommerce

Depending on the transactional relationships and the type of goods and services provided, ecommerce can be applied through different practices:

Online shopping

With the help of ecommerce, various types of buyers and sellers, from individuals to organizations, can buy and sell goods or provide services through different ecommerce platforms.

Online banking

Electronic banking, which is also known as a virtual banking system, is a way of delivering traditional banking products and services via electronic channels. Customers can access online banking using their electronic devices, ATMs, etc.

Online subscriptions

This eсommerce service allows customers to get access to online products such as music, movies, or books by paying a recurring price at regular intervals.


Crowdfunding is the practice of raising startup capital in order to create a product, which is suggested by sellers. Once enough consumers have supported the product financially (i.e backed it), it’s then created and shipped to them. 


Dropshipping is the method of supply chain management when a retailer sells products that are manufactured and shipped to consumers via a third party. If you want to find out more, please consider checking our article on how to build an ecommerce business

If you are interested in finding out how to build your own ecommerce business, please consider reading our step-by-step guide on this topic:

How To Start An Ecommerce Business: The Ultimate Step-by-Step Guide

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Top 9 Ecommerce Metrics To Grow Your Ecommerce Business

Enterprise Ecommerce Platform Comparison: How to Select Between Magento, Salesforce, Hybris, Shopify, BigCommerce, and Oracle

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