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Understanding the C2C E-commerce Business Model


C2C E-Commerce

We have been familiar with the B2C (Business to Customer) e-Commerce business model, where businesses sell their product to customers via an online platform. The B2C e-commerce sector has recorded many success stories. However, we often underestimate the meteoric rise of C2C e-commerce in the past decade. According to McKinsey, many C2C marketplace startups have accelerated their growth during the pandemic.


What is C2C E-Commerce?


C2C stands for Customer to Customer. C2C E-commerce is an online platform where customers can buy and sell their products/services to each other. In this business model, e-commerce acts as an intermediary that facilitates transactions between customers. C2C e-commerce has contributed to many lives by making buying and selling products/services more accessible. Anyone can apply as a seller and is responsible for their business growth on this platform. Some famous worldwide C2C E-commerce companies are Amazon, eBay, and Alibaba.



Types of C2C E-Commerce


C2C E-Commerce is divided into two categories, marketplace and P2P.


1. Marketplace


The marketplace is where customers (not a brand) can sell their products or services with the help of an e-commerce platform as intermediaries. In the marketplace, people can sell and buy a product on an e-commerce platform such as Tokopedia and Shopee.


2. P2P/Classified


The next type of C2C e-commerce is P2P/Classified. In the P2P model, the customers can directly sell their products or services to other customers without e-commerce as intermediaries. Some of the common P2P platforms are Instagram, Kaskus, and OLX.



Advantages of C2C E-Commerce


1. Competitive products at a Lower Price


In running a traditional retail company, a business should spend more money on third-party actors to maintain and deliver their products/services to customers. On the other hand, C2C e-commerce removes the role of all middlemen in the transactions. Because of this, the seller can press their cost, which results in a lower price of goods.


2. Variety of Options


The C2C business model also helps buyers find the right product/service. Because of the easy entry nature of C2C e-commerce, the market is saturated by many sellers who compete to provide their unique products. This gives buyers more options for purchasing a product/service at a lower price.


3. Easy Access to Sell and Buy


In a physical store, people have a huge barrier to entering the market. One of the barriers is spending a lot of money to make a physical store. C2C e-commerce solves this by providing easy access to the market. Anyone can sell their products/services even without a physical store. The C2C e-commerce also helps buyers access products/services without having to go to many stores to find and pay for transportation.



Are You Interested in Building a C2C E-Commerce?


Gear up is one of our partners that will help you navigate the never-ending challenges of building a startup. Gear Up is a startup brainstorming partner in Indonesia that provides one-on-one and catered support for the chosen startups. Gear Up can help you find the correct business model, gain funding for your startup from venture capital, and scale up your startup. Join Gear Up to begin your startup journey.


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