What is e-commerce?

One of the earliest instances of e-commerce solutions dates back to 1981 when Thompson Holidays created an online shopping system. The mid-90s saw the active development of e-commerce services, with the emergence of platforms like Alibaba Group and Amazon. Today, both market leaders and start-ups are capitalizing on the advantages of e-commerce, which are primarily linked to profit growth and business process optimization. However, online shopping platforms also assist companies in achieving other significant objectives.

E-commerce platforms and the solutions they provide to businesses include:

1. Reduced costs: Primarily, cost savings are realized by avoiding expenses related to employee hiring and renting physical spaces. Automation of tasks such as data collection, order processing, and lead generation further contributes to cost reduction.
2. Expanding the target audience: Digitalization enables precise targeting tools, facilitating the expansion of a product or service’s target audience.
3. Direct trade opportunities: E-commerce accommodates companies aiming to sell products directly without relying on intermediaries or inflating prices.
4. Maintaining a positive reputation: Through social networks, companies engage with consumers by answering queries and promptly addressing complaints, fostering high-quality communication with customers.
5. Analytics tools: Businesses leverage tools like Google Analytics and Facebook Insights to collect data on customer preferences and online behaviour. Marketing campaigns informed by analytical data prove significantly more effective in boosting sales.
6. Shopping convenience: At its core, e-commerce simplifies the shopping process, irrespective of location. On popular marketplaces and social networks, users can make purchases with just a few clicks. The potential for emotional and sometimes impulsive purchases work in favour of businesses.

Exploring the workings of an e-commerce platform involves understanding its advantages and recognizing its disadvantages, types, and categories.

E-commerce: Types and Categories

In a broad sense, e-commerce represents a distinct sector of the economy where financial transactions and dealings occur over the Internet. For manufacturers and suppliers, e-commerce platforms provide a means to showcase and sell their services or products online. Meanwhile, customers can conveniently browse, select, and make online payments for products or services.

The types of e-commerce vary based on the parties involved: consumer-administration-supplier.

1. B2B (Business to Business): As the name implies, in B2B, one business supplies goods or services to another business. An example is Intel creating processors specifically for Apple before Apple started producing its own.
2. B2C (Business to Consumer): This is the most common form of e-commerce, where consumers can directly purchase services, goods, or products from the e-commerce platform. For instance, anyone can buy Adidas or Nike sneakers through their official mobile applications or websites.
3. C2C (Consumer to Consumer): C2C e-commerce platforms allow consumers to sell products or offer services to other consumers. A notable example is the OLX platform, which serves as a portal for sales without the involvement of manufacturing companies.
4. C2B (Consumer to Business): The C2B platform operates in contrast to the B2C model. For instance, an individual may specialize in creating leather jewellery and sell it through an online platform representing an e-commerce business.
5. C2A (Consumer to Administration): This less common e-commerce type involves transactions between government authorities and consumers. In Ukraine, a notable example of the C2A model is the Diya platform, which facilitates tasks such as applying for a mortgage, obtaining a COVID-19 certificate, generating a tax return, etc.
6. B2A (Business to Administration): This e-commerce model is particularly prevalent in dealing with legal documents, social, and fiscal security. It enables companies and government agencies to easily conduct online transactions, such as the online procurement of goods by government agencies.

E-commerce Fundamentals: Implementation of Online Trading Solutions and Their Drawbacks

Online stores. Whether developing a large or small online store, a well-defined structure and user-friendliness are paramount for success.

Ad platforms or services. These solutions find relevance in the C2C model, exemplified by platforms like OLX offering a space for consumer-to-consumer transactions.

Services with promotional codes, special offers, and discounts. Some solutions function as bonus aggregators for consumers, providing promotional codes, special offers, and discounts.

Internet auctions. Platforms following the eBay format capture the interest of both sellers and buyers in the realm of online auctions.

Solutions for online payments. These platforms facilitate online payment for fines and utilities, enhancing user convenience.

Potential Disadvantages of E-commerce Platforms:

1. Unequal network access and mail connection deficiencies: Uneven internet access and interruptions in postal connections pose challenges for businesses in Asia, Oceania, the Middle East, and Europe engaged in e-commerce activities.
2. Legislation lagging technology: The evolving nature of technology may outpace legislation, necessitating the introduction of rules for platforms. For instance, platforms like Google request permission to collect and process users’ personal data, aligning with laws and enabling targeted advertising based on user interests.
3. Risks of data leakage: Imperfections in cybersecurity systems expose e-commerce platform users to the risk of data leakage, allowing third parties to exploit personal data for their gain.
4. Risks associated with the appropriation of intellectual property: Copyright laws are sometimes insufficient to fully protect original ideas and works of art from commercial exploitation, posing risks for creators in the e-commerce landscape.

E-commerce Solutions at PNN Soft

Despite the drawbacks associated with e-commerce platforms, the undeniable advantages of these solutions cannot be overstated. E-commerce provides companies with the means to enhance customer loyalty and streamline the shopping process. However, it is equally crucial to focus on the scalability and flexibility of the future platform to extract maximum benefits from the e-commerce landscape. For instance, having a system that supports both B2B and B2C sales on the same platform is optimal. At PNN Soft, our developers opt for a cloud environment to ensure easy scalability as your business expands.

With a track record spanning over two decades, we specialize in developing tailor-made solutions, encompassing web and desktop platforms. Our portfolio boasts the successful completion of over 1000 projects, including mobile applications, Progressive Web App (PWA) platforms, and marketplaces catering to the diverse needs of the e-commerce market. The PNN Soft team is at the forefront of incorporating cutting-edge technologies such as AI, Machine Learning, Blockchain, Virtual and Augmented Reality to enhance platform interactivity, user-friendliness, and deliver a personalized user experience. Our primary objective is to assist you in attracting new customers, fostering loyalty among existing ones, and achieving high profitability through our development services.

Drawing on our extensive 20-year experience in the e-commerce domain, the PNN Soft team tailors solutions to align with the specifics of your business industry and long-term goals. We understand how to optimally customize platforms to meet your unique needs and ensure success in the dynamic world of e-commerce.