What is B2C ecommerce? Models, examples, and definitions

May 18th 2023 ecommerce

Remember life before online shopping? When you had to actually leave the house for a brick-and-mortar store to get groceries, rent a movie, or try on clothes in person? When the whole revolutionary idea of digital commerce was but a glint in some genius’s eye?

Business-to-consumer (B2C) ecommerce — businesses selling products or services directly to individual consumers — has certainly taken over, growing exponentially in recent years by offering  convenience, variety, and excellent prices. The direct-seller ecommerce market is blazing hot. According to Statista, In 2021, retail ecommerce sales were $5.2 trillion, which they projected to increase 56%, to $8.1 trillion, in 2026.

Yet success doesn’t come easily for many B2C ecommerce businesses, whether they’re entrepreneur-fueled startups or established behemoths. This type of business model has heralded a competitive and complex battlefield for the eyes, wallets, hearts, and minds of its end users.

Here’s a quick guide to B2C ecommerce platform functionality; the different B2C business models, and, for inspiration, a few examples of successful B2C companies.  

What is B2C ecommerce?

You don’t have to look very far to see the business-to-consumer model in action. When you’re a consumer, every day is probably a montage of B2C experiences. Receiving a grocery-store delivery. Buying a shirt. Watching a movie on Netflix. Even reading news articles on advertising-based media sites like Huffington Post counts. So does flying coach to the Caribbean, courtesy of Expedia.

In addition, many of your favorite memories probably involve B2C transactions, such as when you found that cool collectible offered by a small business on eBay or bought the perfect something-or-other in three colors on your go-to retail marketplace site.

B2C can involve any retail experience, but the difference here is that it occurs online or in mobile apps. Speaking of which, B2C ecommerce is increasingly being conducted on smartphones and other mobile devices. Everyone with a phone is carrying around a portal to B2C ecommerce experiences. Something to keep in mind if you’re a B2C retailer.

B2C vs. B2B ecommerce: what’s the difference? 

To understand B2C selling, it’s also helpful to know the ways in which it’s fundamentally different from business-to-business (B2B) online selling (plus, to complicate things, there’s also C2C, consumer-to-consumer).

The B2C and B2B models have traditionally involved different types of approaches, tactics, and strategies tailored for business buyers vs. for end consumers. One difference is that B2B business sales typically span longer time frames, as B2B buying decisions often require sign-off by multiple stakeholders, including those who safeguard company budgets.

By contrast, B2C purchases from online businesses are simple. The only things holding consumers back are things like their personal willpower and budgets. While some B2C purchases do involve greater time, planning, and consideration, such as when buying a house, this extra-time situation usually occurs when large amounts of money are involved.

It’s worth pointing out that as the online world changes, the dividing line between how B2B companies and B2C ones operate is beginning to erode. But for now, they’re still relatively different.

What are the different ecommerce B2C models?  

Various B2C ecommerce models have been adopted to meet consumers’ needs. These include:  

Direct to consumer (DTC)  

Businesses sell products directly to consumers through ecommerce stores, using their online presence to bypass intermediaries such as retailers and wholesalers. This affords control over distribution, pricing, and branding.   

Online marketplaces  

Multi-vendor digital platforms such as Amazon, eBay, and Etsy connect buyers and sellers to complete online sales. Their established branding and B2C marketing options and efforts can help businesses connect with a wider prospective customer base than they might hope to reach on their own, plus ensure a professional, satisfying user experience. 

Dropshipping  

In this model, companies sell items through websites but don’t keep them in stock. They take orders and purchase products from third-party suppliers, who then ship the items directly to the customers. 

Subscription based  

Think Spotify, Shopify, LinkedIn, and many other big hitters in the Apple App Store and Google Play Store. This model involves charging customers a recurring fee for personal use of products or services. Among ecommerce business models, this fee-based operational method is excellent for creating a loyal customer base and reliable revenue stream for both product and service providers.

Advertising based

The advertising-based B2C model is all about content marketing. And traffic. In a world where blog posts, rolling news stories, and videos rule supreme, selling ad space targeted to people through relevant content is a highly effective way to excel.

Community based

Most people are familiar with the community-based B2C model but call it another name: social media. This model is all about vibrant, thriving online communities. The data generated on social media platforms, such as demographics, location, and user behavior and interests, is leveraged for creating targeted ads. 

Crowdfunding  

Crowdfunding involves raising money from a large group of individuals to support a new product or business idea. Platforms like Kickstarter enable businesses to secure funding from potential “investors” (customers) in exchange for future products or services.  

B2C success stories  

Real-world examples of B2C can reveal innovative ways that these organizations are reaching their target audiences and driving success. Here are three standouts: 

Amazon 

The world’s largest online retailer is a prime (pun intended) pioneer in the B2C world. Amazon offers such a vast range of products that you can buy almost anything on this site. More impactfully, however, management’s commitment to putting customers’ needs first led to the creation of the hyper-personalized recommendations that are now so ubiquitous in B2C ecommerce.   

Casper 

The history of ecommerce is full of cool examples of a company coming up with a marketing strategy that transforms how people think about a product (and even an entire industry) by applying an innovative twist. In this case, a DTC company revolutionized the mattress industry by introducing the concept of a mattress in a box. As PR expert Shama Hyder put it, buying a mattress used to be “1. Dread-worthy. 2. Boring. 3. Way too expensive. 4. All of the above.” Casper’s twist: use the right materials and packaging to get high-quality mattresses to people easily, fast, and inexpensively, plus supply extensive free content to promote people’s connection with the brand.

Birchbox  

This subscription-based beauty-box provider delivers monthly personalized samples of products to customers. With more than 1 million subscribers, it’s succeeded through understanding and effectively responding to individual customer preferences. This involves managing and optimizing their personalized offers by using complex open-source search code. 

The role of B2C online stores  

Perhaps the most important aspect of B2C ecommerce is — you guessed it — the online store. A well-designed B2C store is crucial. You need a place to showcase your products and services, allow consumers to make purchases, and leverage opportunities for driving revenue.  

Here are the key elements of a winning B2C ecommerce online store: 

The right platform

You want an ecommerce solution based on the B2C model that works best for your business. For instance, a DTC model requires its own ecommerce site, yet other organizations may be better suited to setting up a storefront on an online marketplace site.  

Good usability

A B2C ecommerce site must be visually appealing, easy to navigate, and optimized for people using mobile devices. Shoppers expect to find what they need quickly and easily; if they don’t, they’ll bounce straight to a competitor’s site. 

A mobile-first customer experience 

Remember, there’s no getting around the fact that B2C ecommerce experiences are increasingly happening on mobile — and this platform preference will only strengthen in the years to come. Optimizing for the needs of people on mobile is a must.

Personalized customer journeys

Another crucial aspect of meeting the expectations of modern consumers is personalization. Potential customers expect their favorite companies to know their preferences and interests, and to use that data to then supply them with “thoughtful” recommendations and other indicators that the company cares about their buying needs. 

Merchandising optimization 

Merchandising optimization can boost revenue by making certain products and services stand out. Optimization techniques range from site design that directs shoppers to relevant products to using AI to improve shoppers’ personalized recommendations. It’s all about showing people the right items at the right time. 

Smooth omnichannel experiences 

When it comes to modern commerce transactions, shoppers may traverse a multitude of channels as they interact with a company and learn about its products and services. The online store may be akin to the sun that the other B2C channels orbit, but people might also click an ad on social media, go into the retailer’s physical store, or buy something online and pick it up curbside to complete their B2C transaction. So providing a consistent and pleasant omnichannel experience for shoppers, regardless of the ways they interact with your brand, is key.  

Streamline your B2C site 

Want better B2C conversion rates and a bigger piece of the B2C ecommerce market? Aiming to be the next Casper? At Algolia, we provide an API for B2C ecommerce website success through AI-powered search, merchandising optimization, and more. We can help you take your ecommerce site to the next level. Get in touch with us when you’re ready!