ECommerce, also known as electronic commerce, is a business model that involves transactions carried out on the internet. In almost a century, it has managed to revolutionize retailing and has evolved considerably to meet the changing needs of today’s consumers. Significantly, since 2016, the share of online retail sales against total retail sales worldwide has recorded an increase of 10.5%, and for the year 2019, global e-commerce sales reached an impressive figure of $3.5 trillion!
The crisis caused by the global pandemic (COVID-19) in the last three years has created a visibly differentiated trading environment. The immediate and forced use of digital technology (web – internet) has changed consumer behavior to the detriment of offline retail, bringing a large proportion of traditional consumers to online stores.
This has demonstrated, on the one hand, that drastic changes in consumer habits have been created and, on the other hand, that e-commerce is now an increasingly lucrative option for businesses.
However, let’s take things from the beginning, following e-commerce from its first form to its unabated penetration into the modern business world.
HISTORICAL BACKGROUND
The inspiration for e-commerce was Michael Aldrich, who in 1979 connected his television to a computer using his telephone line. This story may not directly refer to e-commerce as we know it today, but it was the one that gave the idea of making purchases without the need for the customer to visit the physical store.
So, precisely because at that time, most people did not have computers, two important names came to introduce them to the public, thus paving the way for e-commerce. It was Bill Gates and Steve Jobs, who directly passed the baton to Jeff Bezos and Amazon (1994), the online store that is now considered one of the most popular e-shops in the modern world.
MODERN TRENDS
The 21st century, then, has been particularly favorable for e-commerce, which, with the explosion of global sales, has become a growing and profitable industry. Technological development since then has begun to introduce new terminology and trends, while e-commerce business models have expanded. In particular:
- B2B, business to business, model takes place when a business sells products to other businesses. Alibaba is an example of such a business, as its suppliers sell their products to other businesses. Its prices are extremely low, as they are wholesale prices so that businesses can make a profit on their products.
- B2C, business to consumer, model includes businesses that sell products to consumers, e.g. Amazon, mentioned above.
- C2C model, consumer to consumer, takes place when consumers sell to other consumers, e.g. eBay.
- C2B model, consumer to business, takes place when a consumer sells their products or services to a business or organization, e.g. a photographer selling their photography to a business.
In addition, eCommerce Website was added to the terminology. From the Physical Goods eCommerce Website, i.e., the online store of merchants with the purpose of selling products to a wider audience, to the Service-Based eCommerce Website that acts as a link between a freelancer and his potential customers… everything indicates that modern commercial activity goes beyond the limits of a simple web-based e-shop application and requires advanced technologies and services.
Software such as e-commerce platforms allow businesses to create online stores. In these, they can sell products or services to people internationally, using delivery services to transport their products to customers (e.g. Shopify).
Therefore, as networks and technology platforms improve in speed and security, more and more consumers soon will trust e-shops for their purchases and become familiar with the innovations and facilities offered by leading e-commerce brands.
We expect an even greater impact of technology on eCommerce, with a more virtual or augmented reality for shoppers in the coming years. It is therefore worth investing in a deeper understanding of eCommerce, which is rapidly transforming into a highly competitive and demanding industry.