eCommerce Define: What Is E Commerce?

Joshua Weatherwax
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Are you starting an ecommerce business or just looking for some eCommerce business ideas?

Read our Free Comprehensive eCommerce eBook

Then the first thing you need to know is what eCommerce means. You see the term everywhere today, but what exactly is it?

Read on to discover part of our eCommerce business guide on what eCommerce means, what an eCommerce business is, and a bit about the history of eCommerce.

What’s eCommerce? What Does eCommerce Mean?

eCommerce, also called electronic commerce or internet commerce, is the buying and selling of products or services over the internet. This may be the only way a business conducts business, or it could supplement an existing brick-and-mortar store. All that matters is they advertise, sell, and complete the transaction online.

The term originated in 1994 when the first online transaction took place on the website NetMarket. A single CD from the band Sting was sold to a friend. The industry only grew from there with more than 25% of all businesses in the world now operating solely online. In fact, the industry is so important today that we had to compile the best eCommerce books and best eCommerce blog for you.

eCommerce or E Commerce?

Both eCommerce and e-Commerce are acceptable ways to refer to the industry. In its early years, the hyphen was commonly used and can be found in many textbooks and articles from the early 2000s. This mirrors how the word email used to be spelled e-mail when it was new and novel.

Today, per Google search trends, eCommerce is the more common spelling. This is likely because digital marketers preferred this spelling and it began to use it everywhere. From there it caught on and the rest is history.

What Is E Commerce Business?

An eCommerce business is a business that operates mostly or entirely via the internet. There are four major types of eCommerce businesses.

Types of eCommerce Business

They are:

  • Direct to consumer business model (DTC). Here, the business sells its products directly to individual customers (see D2C meaning). This is the most common form of eCommerce and there are more direct to consumer companies than any other type. These businesses have access to a large base of customers, but order value is low. That's one of the major B2B vs B2C differences.
  • Business to business model (B2B). In this model, a B2B business sells its products or services to another business. The second business will then either resell the product or use it. These companies may host their own site, or sell to other businesses via a B2B eCommerce platform like BlueCart eCommerce. This gives them access to thousands of customers while taking away the stress of website creation, design, and reporting. It's like a wholesale directory where you can buy wholesale products. (see how to become a wholesaler).
  • Consumer to business model (C2B). Here, individual consumers sell directly to a business, essentially the reverse of direct to consumer brands. These models are almost entirely based on services, like freelancers or independent contractors. A third party owns the site and connects the parties while collecting a small fee. It's a good alternative to investing in a headless eCommerce platform.
  • Consumer to consumer business model (C2C). Often called a consumer online marketplace, these sites allow individuals to sell products or services to one another. The site is an independent company that takes a percentage of each sale. These sites are great for people who want to do things like sell wine from home.
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eCommerce Trends

The eCommerce industry continues to have exponential growth and shows no signs of slowing down.

Here are some interesting data points and eCommerce trends to illustrate what we mean:

  • There was nearly $4 trillion in global sales for eCommerce businesses in 2020.
  • The eCommerce industry is seeing more than 20% growth each year.
  • 93% of all global internet users have made at least one purchase online.
  • By 2040, an estimated 95% of all purchases will be made via eCommerce.
  • 51% of digital shoppers make purchases with their smartphones.
  • Nearly one-third of all consumers buy products online every week.
  • 43% of all eCommerce traffic comes through eCommerce SEO.
  • 25% of all businesses now sell products through social media.
  • China is the biggest eCommerce market with over $2 trillion in sales in 2020.
  • More than 90% of customers will not convert if there are perceived issues with eCommerce fulfillment, eCommerce shipping, or eCommerce packaging

What Is an E Commerce Site?

An eCommerce site is a website specifically built to sell products or services to customers. The entirety of the transaction takes place online, including the eCommerce payment. That's why there are so many options on the market for eCommerce software.

One form of eCommerce site that has massively grown in popularity over the past two decades is the online marketplace. These sites let consumers or businesses sell products directly to one another while paying a small fee to the site owner. For food suppliers, BlueCart eCommerce is the ideal choice. With an industry-leading digital catalog, integrated payment processing, and a slew of reports businesses can connect with customers and make DTC food and B2B sales easily. It's even great at cross selling.

Read our Free Comprehensive eCommerce eBook

If You Don't Know, Now You Know

eCommerce businesses and sites now make up a good percentage of businesses in the 21st century. Each year we will continue to see growth, and more entrepreneurs are starting eCommerce businesses every day. Just make sure to pay attention to your eCommerce analytics or you'll never be able to intelligently increase eCommerce sales.

Running an eCommerce business takes a lot of effort. That's why our team created BlueCart eCommerce, to help make it easier for food suppliers and their customers to connect. It's an all-in-one solution that works as both a DTC and B2B wholesale marketplace and looks like a streamlined line sheet.