How Does ELECTRONIC RETAILING Works: E-tailing vs E-Commerce


Electronic retailing (e-Retailing) or online retailing is the sale of goods and services over the Internet. E-retailing can include business-to-business (B2B) and business-to-consumer (B2C) product and service sales. With e-tailing, companies must adapt their business models to capture Internet sales. This also includes the development of sales channels such as warehouses, Internet websites, and product dispatch centers.

How Electronic Retailing (E-Retailing) works

E-retailing spans a wide range of businesses and industries. However, there are similarities between most e-commerce businesses, including having a responsive website, an online marketing strategy, efficient product or service distribution, and analyzing customer data.

Successful e-retailing requires a strong brand. Websites should be attractive, easy to navigate, and regularly updated to meet the changing needs of consumers. Products and services must differentiate themselves from competitive offerings and create added value for consumers’ lives. Also, a company’s offerings must be competitively priced so that consumers don’t prefer one company over another based on cost.

Electronic retailers need strong distribution networks that are fast and efficient. Consumers cannot wait long for products or services to be delivered. Transparency in business practices is also important for consumers to trust and stay loyal to a company.

There are many ways that businesses can generate income online. The first source of income is, of course, selling your product to consumers or businesses. However, both B2C and B2B companies could generate revenue by selling their services through a subscription-based model like Netflix, which charges a monthly fee to access multimedia content.

Income can also be generated through online advertising. For example, Facebook generates revenue from the ads that companies display on their website that they want to sell to Facebook users.

Types of e-retailing

Business-to-consumer (B2C) e-commerce

Business-to-consumer retail is the most common of all e-commerce businesses and the most familiar to most Internet users. This group of retailers includes companies that sell goods or manufactured products to consumers online directly through their websites. Products can be shipped and delivered from the company’s warehouse or directly from the manufacturer. One of the main requirements of a successful B2C retailer is maintaining good relationships with customers.

Business-to-business (B2B) e-commerce

Business-to-business retail includes businesses that sell to other businesses. These retailers include consultants, software developers, freelancers, and wholesalers. Wholesalers sell their products in bulk from their manufacturing facilities to companies. These companies, in turn, sell these products to consumers. In other words, a B2B company like a wholesaler can sell products to a B2C company.

E-tailer Examples (AMZN)

Amazon is the largest online retailer selling consumer products and subscriptions through its website. Amazon’s website reveals that the company had sales of more than $ 230 billion in 2018 and at the same time generated more than $ 10 billion in profit or net income. Other electronic retailers that work exclusively online and compete with Amazon are and

The Alibaba Group (BABA)

Alibaba is the largest electronic retailer in China operating an online commerce business in China and internationally. Alibaba has introduced a business model that not only includes B2C and B2B trade.

They connect Chinese exporters with companies around the world looking to buy their products. The company’s Rural Taobao Program helps rural consumers and businesses in China to sell agricultural products to people in urban areas. In 2018, Alibaba had nearly $ 40 billion in annual sales and just under $ 10 billion in profit.

E-tailing advantages and disadvantages

The benefits of electronic retailing include:

  • Easy Market Access – In many ways, market access has never been easier for entrepreneurs. In online marketplaces like eBay and Amazon, anyone can set up a simple online store and sell products in minutes. See the sale through online marketplaces.
  • Reduced Overall Costs – Selling online eliminates the need for expensive retail stores and customer-facing employees, so you can invest in a better customer and marketing experience on your e-commerce website.
  • Rapid Growth Potential- Selling on the Internet means that traditional restrictions on retail growth: e. B. Finding and paying for larger products are not essential factors. With a good digital marketing strategy and a plan for an order fulfillment system at scale, you can respond and increase sales. See Planning for e-commerce.
  • Expand your market/export – A great advantage over local retailers is the ability to expand your market beyond local customers very quickly. You may find that your products are in high demand in other countries, and you can respond to this with targeted marketing, offering your website in a different language, or working with a foreign company. See Export basics.
  • Customer Intelligence – The ability to target new customers using online marketing tools and website analytics tools to better understand your customers’ needs. Read more guides on how to improve your customers’ experience

Disadvantages of E-Retailing

Some negative aspects of electronic retailing are:

  • Website Costs: Planning, designing, building, hosting, securing, and maintaining a professional eCommerce website is not cheap, especially if you expect large and growing sales volumes. Check out the common pitfalls of e-commerce.
  • Infrastructure Costs: Even if you are not paying the cost of customer space, you need to think about the cost of physical space for order fulfillment, merchandise storage, returns processing, and staffing for these tasks. See Fulfill orders online.
  • Security and fraud: The growth of the online retail market has drawn the attention of sophisticated criminal elements. Your company’s reputation can be deadly if you don’t invest in the latest security systems to protect your website and transactional processes. See Ecommerce Errors: Security Vulnerabilities.
  • Legal Issues: Dealing with e-commerce and the laws can be challenging. You must know and plan how to deal with the additional customer rights associated with online sales. Check the law and sell online.
  • Advertising Expenses: While online marketing can be a very efficient way to attract the right customers for your products, it requires a generous budget. This is especially true when competing in a crowded industry or for popular keywords. See pay per click and paid search advertising.
  • Customer Trust: Establishing a trusted brand can be difficult, especially without a physical company with a history and face-to-face interaction between customers and sales reps. You should consider the cost or the establishment of a good customer service system as part of your online offering.

E-tailing vs e-Commerce

E-tailing is the implementation of business processes on the Internet. Electronic commerce (electronic commerce or e-Commerce) is the purchase and sale of goods and services, or the transfer of funds or data through an electronic network, mainly the Internet. E-commerce generally creates a platform for sellers to offer their products or services to consumers.

Do you want to start online retailing? Check out 6 Easy Steps to Developing a Business Plan Outline for your business

RELATED: E Marketing: The Ultimate Guide

Electronic Retailing FAQs

What is online retailing example?

The sale of goods and services over the internet is called “electronic retailing.” Business-to-business (B2B) and business-to-consumer (B2C) sales of goods and services can both be done through e-commerce. (AMZN) is by far the biggest online store that sells consumer goods and offers subscriptions.

Is Amazon an online retailer?

Amazon is the biggest online store in the world, and it is quickly expanding into other areas like brick-and-mortar stores, subscription services, and web services. Target, Walmart, Best Buy, and Costco are some of the stores that compete with Amazon.

Which type of e-commerce is Amazon?

Consumer-to-customer eCommerce is one of the oldest types of eCommerce. It is the sale of goods or services between customers. This includes sales between two people, like those on eBay or Amazon.

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