WHAT IS E-COMMERCE? Are you thinking of starting a business where you sell your products online? If so, you will be joining the millions of entrepreneurs who have carved out a place for themselves in the world of e-commerce.
At its core, e-commerce refers to the buying and selling of goods and/or services through electronic channels such as the Internet. Electronic commerce was first introduced in the 1960s through electronic data interchange (EDI) over value-added networks (VANs). The medium grew with the increased availability of Internet access and the advent of popular online sellers in the 1990s and early 2000s. Amazon began shipping books from the garage of Jeff Bezos in 1995. eBay, which allows consumers to sell to each other online, introduced online auctions in 1995 and exploded with the 1997 Beanie Babies frenzy.
Like any digital technology or consumer-based shopping marketplace, e-commerce has evolved over the years. As mobile devices have become increasingly popular, mobile commerce has become its own market. With the rise of sites like Facebook and Pinterest, social media has become a major driver of e-commerce. In 2014, Facebook was responsible for 85% of social media sales on the Shopify e-commerce platform, per Paymill.
The evolution of the market represents a vast opportunity for companies to improve their relevance and expand their market in the online world. Researchers predict that e-commerce will account for 17% of U.S. retail sales by 2022, according to Digital Commerce 360. The U.S. will spend an estimated $460 billion online in 2017. Those numbers will continue to rise as mobile and Internet usage increases in the United States and in developing markets around the world.
As in traditional commerce, there are four main categories of e-commerce: B2B, B2C, C2B and C2C.
B2B (Business to Business) – These are companies doing business with each other. For example, manufacturers sell to distributors and wholesalers sell to retailers.
B2C (business to consumer) – B2C consists of businesses that sell to the public through shopping cart software, without the need for any human interaction. This is what most people think of when they hear e-commerce. Amazon is an example.
C2B (Consumer to Business) – In C2B e-commerce, consumers post a project with an established budget online, and businesses bid on the project. The consumer reviews the bids and chooses the company. Elance is an example.
C2C (consumer to consumer) – This is done through classified ads, forums or online marketplaces where individuals can buy and sell their goods. Examples of this are Craigslist, eBay, and Etsy.
Getting started in e-commerce
Before you start, do not hesitate to train in e-commerce on Formationfacile.com. Because it can be learned, so as not to waste time and above all not to make mistakes. Once that’s done and you know what to do, know that if you have a simple product to sell and a desire to increase your online sales, there are a few tools you can use to get started.
Websites like Squarespace and WordPress offer ready-to-use, mobile-friendly e-commerce templates that help you get a store up and running quickly. As a store owner, you will need a way to collect credit card payments from consumers online. PayPal, Square, and Google Wallet are all popular ways to accept and manage payments online. You can also sell your wares through online giants like Amazon.
If you’re selling physical goods, you’ll need to consider how you’re going to ship them. PayPal and other processors have worked with shipping merchants, including USPS and UPS, to offer one-stop postage processing. You’ll also need to research your state laws to determine if you need to obtain an online sales license or if you need to collect your state or local sales tax.
Dropshipping is a way to outsource your inventory and shipping. Dropshipping services store and ship the products you as a merchant sell, multiple times for wholesale prices. These companies act on your behalf, using your brand and packaging. The best of these services have integrations with Amazon, Shopify, and other e-commerce platforms.
As your business grows, you may want to consider more advanced ways of processing payments, such as using a merchant account and service. Services that integrate better with your bank often offer lower transaction costs compared to processors such as PayPal.
As with any new business, the first step to succeeding in e-commerce is to set goals. Do you intend to increase the income of your current customers? Gain new customers? Increase average order value? Sell through new channels? Lower prices? Once you’ve established your goals, it’s time to make a plan.
A SWOT analysis can help you assess the strengths, weaknesses, opportunities, and threats of your current business environment. What does the market look like? Where does your business excel and where does it falter? Review your entire business, not just segments. Evaluate external opportunities, as this is often the first place to invest time and money. Be honest with yourself when analyzing weaknesses and threats, otherwise, the analysis will not help you.
After doing the SWOT analysis, see how it fits into your overall vision. Where do you see your business in five years? In 10 years? This will help you set business goals for the current year, for sales, profit, customers, traffic, new systems, and new staff. Once the goals are set, you can implement a strategy yourself or hire an e-commerce consultant to help you.
Other methods to help you determine the best way to grow your business in a new segment include PEST (Political, Economic, Social, and Technological), MOST (Mission, Objective, Strategies, and Tactics), and Five Forces Analysis. Carry.
Electronic Commerce Law
In addition to a solid business strategy, it is important to have a basic understanding of e-commerce law. Online sellers, especially those who sell internationally or across state lines, face different legal and financial considerations, including privacy, security, rights of the author, and taxation.
The FTC regulates most e-commerce activities, including the use of commercial e-mail, online advertising, and the protection of consumer privacy. Businesses collect and maintain sensitive personal information about their customers, and your business is subject to federal and provincial privacy laws, depending on the type of data you collect.
There are also online advertising laws that protect consumer privacy and ensure honest business practices online. As an e-commerce business, online advertising is a major part of your strategy. Over the past decade, federal and state governments have passed new online advertising laws. As you grow your online marketing business, it’s important to familiarize yourself with it. The CAN-SPAM Act, for example, sets the rules for email advertising, the most important rule being that consumers must be able to opt-out of messages from companies.
In addition to protecting consumers from data leaks and misleading advertising online, digital works are protected on the Internet. There are several provisions that e-commerce businesses should be aware of, including copyright infringement liability and service provider responsibilities.