E-commerce Write for Us
Advantages and disadvantages of E-commerce
The main advantages of e-commerce compared to a traditional business are:
- Access to a global market to expand the target of your online store and get more customers.
- Great potential to scale the business and expand the range of products and services without the need for a significant investment.
- Reducing the costs and expenses involved in managing an online store, both in terms of infrastructure and personnel, is another of the main characteristics of electronic commerce.
However, undertaking in the world of e-commerce also has a series of disadvantages or risks :
- There is great competition, especially from the great online commerce giants and well-known international brands that open their online stores.
- Security issues are usually caused by cyber-attacks that expose customer data and affect trust in the online store.
- The profitability threshold takes time to arrive; generally, you have to make a significant investment in marketing at the beginning so that the e-commerce obtains visibility.
Types of Ecommerce according to your business model
- Online store with own products. The online store works similarly to physical stores since they manage their stock of products, but they operate exclusively on the Internet.
- Dropshipping. This type of e-commerce is only responsible for taking orders from customers, invoicing them and passing them on to the wholesaler, who is the one who stores the merchandise and sends it to the final customer.
- Marketplace. It is a store of stores, a web platform where different sellers offer their products and pay the owner a commission for each sale, like on Amazon.
- Membership. This type of e-commerce seeks recurring sales through a periodic subscription model by systematically sending products to its customers or allowing access to its content, as in the case of Spotify.
- Services. Digital commerce does not exclusively sell physical products; and 79% of online shoppers buy services and 43% digital content. Services e-commerce sells consulting or training products, such as Coursera.
- Affiliation. Although it is not traditional e-commerce since the purchase process is not carried out directly on the website, it is an attractive online business model due to its low costs. It is limited to referring customers to another online store in exchange for a commission for each sale.
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