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What Is eCommerce and How Does it Work? 

What Is ECommerce and How Does it Work?

E-commerce is a strange thing. On the one hand, it seems like it is the new kid on the block — one that will revolutionize the way business is transacted online. On the other, it’s business model often seems identical to physical retail that has been around for centuries. The truth is that both points of view are valid. E-commerce does much the same as physical retail. However, the fact that it operates digitally, introduces some unique business elements.

What is E-Commerce?

E-Commerce (also known as electronic commerce) is a process of buying and selling of products or services, making money transfers, and transferring data over an electronic medium (Internet). This network allows people to do business with no barrier of distance and time.

Types of E-Commerce Businesses

There are various types of eCommerce business options that you can choose from based on your preferences, capital, and online business model. For different businesses, you have to implement different techniques and strategies. Some of the popular online businesses include:

  • B2B businesses
  • B2C businesses
  • Affiliate marketing business
  • Online auction selling
  • Web marketing

How Does E-Commerce Work?

A shopper lands on the website. The website shows categories and products that are loaded in the e-commerce website’s database.

A customer can add items to their cart and create an account. Again, all information is saved in the database, even if temporarily.

Once in checkout, the website should now be secure showing a lock symbol and using an SSL certificate.

During checkout, the website may use third-party software to get shipping rates

When you enter your credit card number the information is passed to a payment gateway.

Your order is now completed. The e-commerce website should not have your payment information in its database. All sensitive information is stored with the payment processor.

What Are The Most Popular E-Commerce Websites?

Thanks to ClueCommerce for this great list of the top ten e-commerce companies!

  1. Taobao
  2. Amazon
  3. Walmart
  4. eBay
  5. Target
  6. Alibaba
  7. Flipkart
  8. NewEgg
  9. Overstock
  10. Best Buy

What is your favorite e-Commerce platform? We’d love to hear from you!

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