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Unit 2.2

B2C Business Models in E-commerce

IT 204: E-Commerce

Learning Objectives

By the end of this chapter, you will be able to:

  • ✅ Define Business-to-Consumer (B2C) e-commerce and its characteristics.
  • ✅ Identify and describe the 7 major B2C business models.
  • ✅ Understand the revenue models and value propositions for each type.
  • ✅ Recognize real-world examples, including prominent Nepali businesses.
  • ✅ Analyze the key success factors and challenges in the B2C landscape.

What is B2C E-commerce?

Business-to-Consumer (B2C) e-commerce refers to online transactions between businesses and individual consumers. It's the digital version of traditional retail shopping.

Key Characteristics:

  • Direct interaction with end consumers
  • Typically high volume, low value transactions
  • Intense focus on user experience (UX) and convenience
  • Marketing-intensive to attract a broad audience

The 7 Major B2C Business Models

  • 1. E-tailer
  • 2. Community Provider
  • 3. Content Provider
  • 4. Portal
  • 5. Transaction Broker
  • 6. Market Creator
  • 7. Service Provider

We will explore the definition, revenue model, and examples for each.

1. E-tailer (Online Retailer)

Definition: Online retail stores that sell physical goods directly to consumers via the internet.

  • Manages inventory & fulfillment
  • Online version of a physical store
  • Revenue Model: Profit from product sales (markup)

Types & Examples

  • Virtual Merchant: Daraz (Nepal), Amazon
  • Bricks-and-Clicks: Bhatbhateni, Big Mart
  • Manufacturer-Direct: Dell, Apple

2. Community & 3. Content Providers

Community Provider

Creates online environments for people with similar interests to connect and share.

Revenue: Ads, premium memberships, transaction fees.

Nepal Example: Hamrobazar, Facebook Groups

Content Provider

Distributes digital content like news, music, and videos online.

Revenue: Subscriptions, ads, pay-per-view.

Nepal Example: Onlinekhabar, Kantipur Online

4. Portal & 5. Transaction Broker

Portal

A "gateway" to the web, offering a broad array of services like search, news, and email.

Revenue: Primarily advertising and referral fees.

Nepal Example: Google, Hamro Patro (acts as a portal)

Transaction Broker

Processes online transactions for consumers and earns a fee for each one.

Revenue: Transaction fees or commissions.

Nepal Example: eSewa, Khalti, Merojob

6. Market Creator & 7. Service Provider

Market Creator

Builds a digital environment where buyers and sellers can meet and transact (peer-to-peer).

Revenue: Transaction/listing fees, promoted listings.

Nepal Example: Facebook Marketplace, Hamrobazar

Service Provider

Offers services online, from digital tools to arranging offline services.

Revenue: Service fees, commissions, subscriptions.

Nepal Example: Foodmandu, Pathao, Tootle

📊 B2C Model Comparison

Model Primary Revenue Inventory? Customer Interaction Example (Nepal)
E-tailer Product sales Yes (Physical) Transactional Daraz
Content Provider Subscription/Ads Yes (Digital) Consumption Onlinekhabar
Transaction Broker Transaction fees No Facilitation eSewa
Market Creator Listing/Transaction fees No Peer-to-peer Hamrobazar
Service Provider Service fees/Commission No Service arrangement Foodmandu

🔍 B2C E-commerce in Nepal

Growth Drivers

  • Rising internet & smartphone use
  • Young, tech-savvy population
  • Growth of digital payments (eSewa, Khalti)
  • COVID-19 impact

Challenges

  • Logistics & delivery infrastructure
  • Building consumer trust
  • Cash-on-delivery preference
  • Digital literacy gaps

Opportunities

  • Untapped rural markets
  • Niche products (handmade, organic)
  • Social commerce
  • Mobile-first solutions

🎯 Keys to B2C Success

  • User Experience (UX)
    Easy navigation, fast loading, mobile-first.
  • Trust & Security
    Secure payments, clear return policies, reviews.
  • Logistics & Fulfillment
    Reliable, trackable, and efficient delivery.
  • Customer Service
    Quick, multi-channel support and problem resolution.
  • Marketing & Acquisition
    SEO, social media, and targeted campaigns.
  • Technology Infrastructure
    Scalable platform with robust integrations.

⚡ Key Takeaways

  • B2C e-commerce involves businesses selling directly to consumers online, with a focus on user experience.
  • The seven major models (E-tailer, Content Provider, etc.) each have unique revenue streams and value propositions.
  • Nepal's B2C landscape is rapidly growing, driven by mobile adoption and digital payments, with local players like Daraz, eSewa, and Foodmandu leading the way.
  • Success hinges on building trust, ensuring smooth logistics, and providing excellent customer service.

Thank You!

Any questions?

Next Up: Unit 2.3 - B2B E-commerce Models

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