What is E-Commerce? Definition, Types, and Business Models - YouTube

Channel: D&V Philippines

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E-commerce offers tons of business opportunities,
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whether you’re already a business owner or interested in becoming one.
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Here’s what you need to know about e-commerce.
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E-commerce refers to the selling and buying of products or services online.
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You have two main options to start selling your products online:
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1. Run your own e-commerce website or
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2. List your products on an online marketplace.
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Having your own e-commerce website is like owning a physical store.
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When online shoppers visit your website,
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they can only browse through your products
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Some of the most popular e-commerce website builders are:
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Shopify, BigCommerce and Weebly
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On the other hand,
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listing your products on an online marketplace
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is like selling in malls or in grocery stores.
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Shoppers can browse through various products from different sellers
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to choose the best deal.
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Among the popular online marketplaces are:
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Amazon, Alibaba and eBay
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E-commerce has 4 main types:
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Example: An online retail store that sells directly to end consumers.
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This can be done both on an e-commerce website
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and an online marketplace.
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Example: A company that sells products or services directly to another company.
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Businesses that sell to other businesses usually sell their offerings
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through their own website.
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Example: A freelancer that offers writing services to business owners
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through websites like Upwork or Fiverr.
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Example: A consumer that sells new or pre-loved products to another consumer
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through websites like eBay or Etsy.
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Another aspect to consider with e-commerce is the business model
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because it will determine how you’ll generate income from selling online.
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Here are the different types of e-commerce business models:
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This model allows you to accept customer orders
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without keeping actual products in stock.
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Rather, a third party fulfils and delivers the order to the customer on your behalf.
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A subscription service lets you send products to a customer
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over a specific time — weekly, monthly, or yearly —
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depending on your customer’s chosen plan.
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This model works well for the
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food, fashion, health and lifestyle, and entertainment industries.
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Example: Netflix and Spotify
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Wholesaling is the practice of selling goods in bulk to retailers
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at discounted rates.
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The retailer then sells the goods to end consumers at profitable prices.
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Retailing is the opposite of wholesaling.
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Rather than selling goods in bulk, you sell goods in lesser amounts,
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or even by piece, to end consumers.
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You can earn through this model by adding a markup
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to the discounted items you got from wholesalers.
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In this model, a third-party manufacturer produces the product
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on behalf of your brand.
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All exclusive rights are granted to your business,
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entitling you to sell the produced materials as your own.
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Determine your business model to find out what you can manage
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and how to make profits.
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Figure out the focus of your business through product and niche research.
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Determine where you will sell:
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an e-commerce website, via an online marketplace or both?
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Know your target audience so you can deliver your messages to the right people.
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Register your e-commerce business and brand name.
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Apply for all the necessary licenses and
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permits to make your business legal.
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Prepare a solid business plan which must include
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the financial and inventory management aspects of your store.