What is E-Commerce?

The E-commerce has different ways businesses and people connect online, and its kind of interesting how they all fit together in a marketplace. The most common one, I think, is business to consumer, or B2C. Thats when companies sell stuff directly to regular people, like if youre buying books or whatever from Amazon, or getting clothes shipped from Flipkart. It happens a lot because everyone shops that way now.

Then theres business to business, B2B, where companies deal with each other instead. For example, a factory might send a huge order of parts to a store chain, or sites like Alibaba help suppliers link up with other businesses for bulk deals. It feels more behind the scenes compared to just buying for yourself.

On the other side, consumer to consumer, C2C, lets people sell things to each other through some platform. You know, like posting old electronics on eBay or local stuff on OLX. Its handy for getting rid of things you dont need anymore.

E-commerce

consumer to business, C2B, that’s when individuals pitch services or products right to companies. Freelancers on Upwork offering to design logos, or influencers who team up with brands for promotions. Sort of flips the usual way around.

E-commerce has these four main types, I guess, and each one works a bit differently depending on whos involved. Like, the business to consumer thing, thats when a company sells stuff straight to people like you or me. You know, ordering a phone from somewhere like Amazon, its super common and easy.

Then there’s business to business, where companies deal with each other. One sells supplies or whatever to another business, not to regular customers. For example, a wholesaler might send goods to a store through a site like Alibaba. It seems kind of behind the scenes compared to the other one.

Consumer to consumer is interesting too, because its people selling to other people. Usully on some platform that helps out. Think about putting a used book or old clothes on eBay, something like that. Or even local apps.

The last type, consumer to business, flips it around a little. Here individuals offer things to companies. Freelancers doing work on Upwork come to mind, like designing or writing for businesses. Im not totally sure if thats the best example, but it fits I think.

So there are these different ways businesses and people interact online, like B2C where a company sells stuff right to regular customers. You know, buying clothes or gadgets from places like Amazon or Flipkart, that is pretty common. It feels straightforward, business to customer directly.

Then B2B is when one business provides things to another business, sort of in bulk or for their operations. For example, a manufacturer might supply goods through something like Alibaba. I think that one is less visible to everyday people, since it is not aimed at individuals.

C2C happens when regular folks sell to other folks, usually on some online site. Like if you have an old phone and put it up on eBay or OLX to sell. It seems easy, but there can be trust issues sometimes.

C2B, that is individuals offering services or products to companies. Freelancers on Upwork doing work for businesses, or influencers teaming up with brands, that fits. Maybe it is the reverse of what we usually think.

In basic terms, B2C goes from business to customer, B2B business to business, then customer to customer for C2C, and customer to business for C2B. Those arrows help make it clear, though sometimes the lines blur a bit in real life.

The term was coined and first employed by Robert Jacobson, Principal Consultant to the California State Assembly’s Utilities & Commerce Committee, in the title and text of California’s Electronic Commerce Act, carried by the late Committee Chairwoman Gwen Moore (D-L.A.) and enacted in 1984.

E-commerce typically uses the web for at least a part of a transaction’s life cycle although it may also use other technologies such as e-mail. Typical e-commerce transactions include the purchase of products (such as books from Amazon) or services (such as music downloads in the form of digital distribution such as the iTunes Store).^[2] There are three areas of e-commerce: online retailing, electronic markets, and online auctions. E-commerce is supported by electronic business.^[3] The existence value of e-commerce is to allow consumers to shop online and pay online through the Internet, saving the time and space of customers and enterprises, greatly improving transaction efficiency, especially for busy office workers, and also saving a lot of valuable time.^[4]

E-commerce businesses may also employ some or all of the following:

• Online shopping for retail sales direct to consumers via web sites and mobile apps, conversational commerce via live chat, chatbots, and voice assistants.^[5]
• Providing or participating in online marketplaces, which process third-party business-to-consumer (B2C) or consumer-to-consumer (C2C) sales. Drop shipping is commonplace in such operations.
• Business-to-business (B2B) buying and selling.^[6] B2B, or what is referred to as business-to-business is defined by the Cambridge dictionary as business arrangements or trade between different businesses, rather than between businesses and the general public.^[7]
• Direct-to-Consumer (D2C) sales, in which manufactures or brands sell directly to end customers without traditional retail intermediaries. This model has expanded rapidly with the growth of digital storefronts and social commerce platforms such as Shopify, TikTok Shop, and Instagram Checkout.
• Data-driven marketing, gathering demographic and behavioral data through web analytics and social media.
• B2B electronic data interchange.
• Marketing to prospective and established customers by e-mail or fax (for example, with newsletters).
• Engaging in pretail for launching new products and services.
• Online financial exchanges for currency exchanges or trading purposes.

There are five essential categories of E-commerce:^[8]

• Business-to-Business
• Business to Consumer
• Business to Government
• Consumer-to-business
• Consumer to Consumer
• Direct-to-Consumer

Contemporary electronic commerce can be classified into two categories. The first category is business based on types of goods sold (involves everything from ordering “digital” content for immediate online consumption, to ordering conventional goods and services, to “meta” services to facilitate other types of electronic commerce). The second category is based on the nature of the participant (B2B, B2C, C2B and C2C).^[9]

On the institutional level, big corporations and financial institutions use the internet to exchange financial data to facilitate domestic and international business. Data integrity and security are pressing issues for electronic commerce.

Aside from traditional e-commerce, the terms m-Commerce (mobile commerce) as well (around 2013) t-Commerce^[10] have also been used.

In the United States, California’s Electronic Commerce Act (1984), enacted by the Legislature, the more recent California Privacy Rights Act (2020), enacted through a popular election proposition and to control specifically how electronic commerce may be conducted in California. In the US in its entirety, electronic commerce activities are regulated more broadly by the Federal Trade Commission (FTC). These activities include the use of commercial e-mails, online advertising and consumer privacy. The CAN-SPAM Act of 2003 establishes national standards for direct marketing over e-mail. The Federal Trade Commission Act regulates all forms of advertising, including online advertising, and states that advertising must be truthful and non-deceptive.^[11] Using its authority under Section 5 of the FTC Act, which prohibits unfair or deceptive practices, the FTC has brought a number of cases to enforce the promises in corporate privacy statements, including promises about the security of consumers’ personal information.^[12] As a result, any corporate privacy policy related to e-commerce activity may be subject to enforcement by the FTC.

The Ryan Haight Online Pharmacy Consumer Protection Act of 2008, which came into law in 2008, amends the Controlled Substances Act to address online pharmacies.^[13]

Conflict of laws in cyberspace is a major hurdle for harmonization of legal framework for e-commerce around the world. In order to give a uniformity to e-commerce law around the world, many countries adopted the UNCITRAL Model Law on Electronic Commerce (1996).^[14]

Internationally there is the International Consumer Protection and Enforcement Network (ICPEN), which was formed in 1991 from an informal network of government customer fair trade organisations. The purpose was stated as being to find ways of co-operating on tackling consumer problems connected with cross-border transactions in both goods and services, and to help ensure exchanges of information among the participants for mutual benefit and understanding. From this came Econsumer.gov, an ICPEN initiative since April 2001. It is a portal to report complaints about online and related transactions with foreign companies.

There is also Asia Pacific Economic Cooperation. APEC was established in 1989 with the vision of achieving stability, security and prosperity for the region through free and open trade and investment. APEC has an Electronic Commerce Steering Group as well as working on common privacy regulations throughout the APEC region.

In Australia, trade is covered under Australian Treasury Guidelines for electronic commerce and the Australian Competition & Consumer Commission^[15] regulates and offers advice on how to deal with businesses online,^[16] and offers specific advice on what happens if things go wrong.^[17]

The European Union undertook an extensive enquiry into e-commerce in 2015–16 which observed significant growth in the development of e-commerce, along with some developments which raised concerns, such as increased use of selective distribution systems, which allow manufacturers to control routes to market, and “increased use of contractual restrictions to better control product distribution”. The European Commission felt that some emerging practices might be justified if they could improve the quality of product distribution, but “others may unduly prevent consumers from benefiting from greater product choice and lower prices in e-commerce and therefore warrant Commission action” in order to promote compliance with EU competition rules.^[18]

In the United Kingdom, the Financial Services Authority (FSA)^[19] was formerly the regulating authority for most aspects of the EU’s Payment Services Directive (PSD), until its replacement in 2013 by the Prudential Regulation Authority and the Financial Conduct Authority.^[20] The UK implemented the PSD through the Payment Services Regulations 2009 (PSRs), which came into effect on 1 November 2009. The PSR affects firms providing payment services and their customers. These firms include banks, non-bank credit card issuers and non-bank merchant acquirers, e-money issuers, etc. The PSRs created a new class of regulated firms known as payment institutions (PIs), who are subject to prudential requirements. Article 87 of the PSD required the European Commission to report on the implementation and impact of the PSD by 1 November 2012.^[21]

In India, the Information Technology Act 2000 governs the basic applicability of e-commerce.

In China, the Telecommunications Regulations of the People’s Republic of China (promulgated on 25 September 2000), stipulated the Ministry of Industry and Information Technology (MIIT) as the government department regulating all telecommunications related activities, including electronic commerce.^[22] On the same day, the Administrative Measures on Internet Information Services were released, the first administrative regulations to address profit-generating activities conducted through the Internet, and lay the foundation for future regulations governing e-commerce in China.^[23] On 28 August 2004, the eleventh session of the tenth NPC Standing Committee adopted an Electronic Signature Law, which regulates data message, electronic signature authentication and legal liability issues. It is considered the first law in China’s e-commerce legislation. It was a milestone in the course of improving China’s electronic commerce legislation, and also marks the entering of China’s rapid development stage for electronic commerce legislation.^[