3. CONTENTS :
E-Business : Meaning, Definitions, Importance (as we
already discussed in module-I).
E-Business models based on the relationships of
Transaction Parties;
1. B2C
2. B2B
3. C2C
4. C2G
5. G2C
6. B2G
3
4. INTRODUCTION & MEANING :
Online Business or e-business is any kind of business or commercial
transaction that includes sharing information across the internet. Commerce
constitutes the exchange of products and services between businesses, groups
and individuals and can be seen as one of the essential activities of any
business. Electronic commerce focuses on the use of ICT to enable the
external activities and relationships of the business with individuals, groups
and other businesses, while e- business refers to business with help of the
internet. The term "e-business" was coined by IBM's marketing and Internet
team in 1996.
The word e-business became popular following an IBM advertising campaign
about computerized procedures to automate business processes. On October
7th, 1997, the IT and consulting firm published an eight-page essay in the
Wall Street Journal and used the term to describe how corporate systems
would fundamentally change in the digital era.
The term e-Commerce (also called Electronic commerce), which is frequently
confused with the broader term e-Business, actually only covers one aspect of
e- Business, i.e. the use of an electronic support for the commercial
relationship between a company and individuals.
4
5. DEFINITIONS :
E-business is a general term that, “encompasses all forms of using
digital information and communication technologies to support and
optimize business processes. In contrast, e-commerce describes only the
online trading of products and services, and is therefore only a
subsection of e-business.”
The term "e-Business", therefore refers to “the integration within the
company, of tools based on information and communication
technologies (generally referred to as business software) to improve their
functioning in order to create value for the business, its clients, and its
partners. “
At the time, IBM understood e-business as “redesigning strategic
business processes and meeting the challenges of a new market
increasingly characterized by globalization, and based on new
knowledge.”
5
6. IMPORTANCE OF E-BUSINESS :
1. Quicker and easier communications
2. Strengthened marketing capabilities and reach
3. Increased hours of operation
4. Access to broader information through research
5. Reducing the cost
6. The opportunities to adopt new business models and develop tailored
customer support
6
7. Modes / Types of E-Commerce
Business :
There are 6 different types of e-commerce businesses.
1. B2B – Business to Business
2. B2C – Business to Consumer
3. C2C – Consumer to Consumer
4. C2B – Consumer to Business
5. B2G – Business to government
6. G2C – Government to Consumer
Every transaction occurring over the internet for e-commerce can be
classified into one of the above types.
7
8. 1. B2B – Business to Business :
B2B, or Business to Business, is the largest e-commerce model. In this
model, both the sellers and buyers are business entities.
This model describes the transactions between a retailer or a
wholesaler, or a wholesaler and manufacturer. Also, the transaction of
the B2B business model is much higher than that of the B2C model.
A website following the B2B business model sells its products to an
intermediate buyer who then sells the product to the final customer. As
an example, a wholesaler places an order from a company's website and
after receiving the consignment, sells the end product to the final
customer who comes to buy the product at one of its retail outlets.
8
9. Some of the examples of B2B models are Alibaba (world’s largest online
business to the business trading platform), Amazon business, IBM,
Boeing, ExxonMobil Corporation, and more.
9
10. Benefits of B2B Model :
1. Products of import and export
2. Encourages business online
3. Position trade guides
4. Determine buyers and suppliers
Features of B2B Model :
1. Long sales cycle
2. More complex model and target market
3. Less price sensitivity
4. Niche marketing strategy focused on trade channels
5. Less potential for emotional and impulse purchases
6. More revenue per sale
7. Customers demand more data
8. Multiple users and user IDs
10
11. 2. B2C – Business to Customer :
The B2C business is the most common type. This is the thickest e-
commerce market.
Business to consumer, known as B2C, is the most common and the
thickest e- commerce market. In this online model, the business sells to
individual customers. This business model offers direct interaction with
the customers.
This model works by marketers and retailers so that they can sell their
goods to internet users. This is the traditional retail model, but the
business is conducted online as opposed to in a physical store.
A website following the B2C business model sells its products directly to
a customer. A customer can view the products shown on the website.
The customer can choose a product and order the same. The website
will then send a notification to the business organization via email and
the organization will dispatch the product/goods to the customer.
11
12. Some examples of B2C models are Amazon, Flipcart, Rediff, Myntra,
Snapdeal, Wal-Mart, Staples, Target, and REI.
12
13. Benefits of B2C :
1. Expansion of niche marketing opportunities
2. Expansion of the marketplace to global proportions
3. Greater customer loyalty
4. Cheaper electronic transactions
Features of B2C :
1. Easy to understand
2. Short sales cycle
3. Clear target market
4. Lower risk and costs of entry
5. Potential for emotional and impulse purchases
6. Mass/ consumer media marketing strategy
7. Price-sensitive customers
13
14. 3. C2C – Consumer to Consumer :
The C2C or consumer to consumer business model involves a transaction
between two consumers. It is also known as a citizen to citizen. A common
example of this model would be an online auction, where a customer or visitor
posts an item for sale and other customer bids to purchase it. However, the
third party generally charges a commission.
Also, having a C2C business or website requires immense planning and
marketing understands. Although the sites act as intermediaries to match the
customers, they don’t check the quality of products being posted online.
A website following the C2C business model helps consumers to sell their
assets like residential property, cars, motorcycles, etc., or rent a room by
publishing their information on the website. Website may or may not charge
the consumer for its services. Another consumer may opt to buy the product of
the first customer by viewing the post/advertisement on the website.
14
15. The few examples for this model include Craigslist, eBay, Quicker and
OLX.
15
16. Benefits of C2C :
1. No intermediary
2. Low transaction cost
3. Round the clock availability
4. Wide Reach
Features of C2C :
1. Negotiable market-based price
2. Simple buying process
3. Potential for emotional and purchases based on needs
16
17. 4. C2B – Customer to Business :
Customer to business, known as C2B, involves customers selling their
services or products to business. It is roughly the same as a sole
proprietorship serving a larger business.
In this model, a consumer approaches a website showing multiple
business organizations for a particular service. The consumer places an
estimate of amount he/she wants to spend for a particular service. For
example, the comparison of interest rates of personal loan/car loan
provided by various banks via websites. A business organization who
fulfills the consumer's requirement within the specified budget,
approaches the customer and provides its services.
The one thing that differentiates C2B from other business models is that
the consumers create the value for the products. Also, the model caters
to the need of freelancers, who work on tasks given by the clients.
However, these websites require planning due to the legal complexities
involved.
17
18. The examples of C2B business models include Google Adsense, Commission Junction,
and Amazon. Fotolia is also a good example of the emerging C2B model.
Benefit of C2B : The major benefit of this type of model is that it helps business firms
to develop and modify the product or services quickly and make it available for the use
in a better way as expected by the target market. The business firms can get many
ideas for developing a new product and may get valuable reviews/suggestions for the
existing product
18
19. 5. B2G – Business to Government :
Business to government is also referred to as the business to
administration commerce. In this model, government and businesses
use central websites to do business with each other more efficiently than
they can off the web.
This e-commerce model is also referred to public sector marketing,
which means marketing services and products to multiple government
levels. With this platform, the businesses can bid on government
opportunities including tenders auctions, and application submission.
B2G model is a variant of B2B model. Such websites are used by
governments to trade and exchange information with various business
organizations. Such websites are accredited by the government and
provide a medium to businesses to submit application forms to the
government.
19
20. One of the popular example of B2G model is “nprocure”, a certified
website for registering tender by the business firms if the amount of
the tender is more than Rs. 5,00,000.
20
21. Features / Usefulness :
1. B2G model of e-commerce lets the business firms and
government share and exchange of important information needed
to conduct the operations effectively.
2. B2G is one of the finest models that facilitates platform for
government transactions across the country with business firms.
3. B2G model, if implemented effectively, can help government cut
down a huge amount of cost, which is very much essential for
the developing country like India.
4. By making it online, government can constantly verify and
monitor the progress and effectiveness of the business deals.
5. B2G model also claims to develop and maintain certain amount
of transparency in the business conduct.
21
22. 6. G2C – Government to Consumer :
Governments use G2C model websites to approach citizen in general. The main
objective is this particular model is to approach the citizens of the country
through the support of website. Such websites are created by local, state or
central government to provide services like; auctions of vehicles, machinery, or
any other material. Such website also provides services like registration for
birth, marriage or death certificates, RTI, PAN card, Government Draws for
house allotment etc. The main objective of G2C websites is to reduce the average
time for fulfilling citizen’s requests for various government services.
Examples : 1. Aadhaar Card - www.uidai.gov.in
2. Rajkot Municipal Corporation - www.rmc.gov.in
3. Passport Registration - www.passportindia.gov.in
22
23. QUESTION BANK
1. Define E-Business. Explain the importance of E-Business.
2. Explain the various models based on the relationships of
transaction parties. (B2C, B2B, C2C, C2G, G2G, B2G)
3. Write a note on B2C.
4. Write a note on B2B.
5. Write a note on C2C.
6. Write a note on C2G.
7. Write a note on G2G.
8. Write a note on B2G.
23
