Comparison between B2B & C2C Websites - Essay Example

?Marketing Executive summary Internet provides a global connectivity through computer network for various purposes at different sectors of the market. With the advancement of technologies various types of websites came into existence for the purpose of businesses from different companies. This report is primarily concentrated towards the analysis of two types of websites, B2B (http://australia.cat.com/) and C2C (eBay.com.au). The products offered and operations of the two companies are analyzed in the project report and recommendation is done for the betterment of the existing techniques used by the two companies. Table of Contents Table of Contents 3 Introduction 4 Types of Websites 6 Comparison between B2B & C2C websites 8 Recommendation for improvements 12 Conclusion 13 Reference 14 Introduction In the year 1990 commercialization f the web began with the introduction of linking websites and the information by Tim Berners-Lee’s. With the advancement in the technological field more innovative approach came into play with the innovation of new hyper text transfer protocol (HTML). New browser was developed by the developers of them the most prominent one becomes Internet Explorer from Microsoft Corporation which gained popularity amongst the users. The major factor behind the rapid growth of the Web technology is due to the fall in price of computers and interest rate of the bank which increases the ownership of computers to great extent amongst the people. Different types of websites came into existence and increased at lightning speed from 19,000 websites to 176M websites just within a period of 18 years from 1990’s to 2008. With time and technological inventions better understanding of the web techniques and developers helped in better communication and user friendly design which created more attractiveness for the websites for different companies. Sometimes the websites are used for the purpose of business transactions while many are providing information about the company. Social networking websites are also gaining popularity with the help of which many companies are expanding their business recognizing the need for building relationship with the customers to expand their business process. It provides a platform for the company interact with the market directly and understand the needs of the market. E-commerce was introduced into web and companies carry out their business over internet for a better reach to the customer resulting in huge growth from $27M in the year 2000 to $ 139M in 2008. Figure 1: E-commerce retail sales growth 2000-2008 (Source: Cengage Learning, n.d.) This report is mainly concerned with the analysis of two kinds of websites one is Business to Business website (http://australia.cat.com/) and the other one is Consumer to Consumer website (eBay.com.au). Both these websites are based at Australia and the companies are operating their business in two different ways with the help of technologies which is needed to be evaluated in this project. Types of Websites While developing a website one of the foremost requirements for the company is to understand the types of business in which the company operates in. With proper understanding of the business process the website development team can implement the strategies and design the website for better grip in the market. Complying with the business model is very essential for a sustainable growth in the market for the company. For operating business online e-Commerce business model is the major tool for the companies to reach to the customers in a more convenient manner. E-Commerce technology can be implemented on several ways in different types of websites according to the business process and the product offering of the company. The different types of websites can be as follows- Business to Business (B2B) When the e-commerce transaction is taking place in between two business units and the buying and selling of goods and services are carried out for manufacturing and producing new products. In business to business process the raw material from the suppliers are taken and then transformed into new products which are then sold to the customers instead of direct selling to the customers (Morley, Parker, 2009, p. 471). Caterpillar (http://australia.cat.com/), from Australia is a good example of B2B website offering machines, engines and working tools for various business sector for producing different products with the use of their machineries. Business to Consumer (B2C) Using web technology and e-Commerce technology the companies sell their goods and services directly to the customers. This type of transaction is known as Business to Customer (B2C) transaction where the final product from the company is directly sold to the consumers without any modification of the final products produced by the company. Many companies like Amazon.com, BestBuy.com use this technique to reach to the customers and offer products directly through internet without any direct contact with the customers (Shelly, Cashman, Rosenblatt, 2009, p. 10). Consumer to Consumer (C2C) This type of techniques in most cases is used in auction sites for offering products from one consumer to another consumer. The online presence of a company advertises products from the consumers which are accessed by other consumers and the transaction takes place between the two. Large companies segment websites according to the countries for easy access to the goods from the consumers of same country for easy transaction process. Ebay.com (eBay.com.au) is one of the largest C2C auction e-Commerce site listing millions of products which is primarily targeted for the Australian customers (Stair, Reynolds, 2011, p. 220). Business to Government (B2G) The business to government model of e-commerce is gaining popularity in developed countries where the business units sell their products and services directly to the local government and state of the country. In general government activities are not much carried out online but with the development in the web technology and more secured approach government activities are slowly moving towards online platform. With the introduction of e-Government facilitates the model of business to government where goods and services are sold by business units directly to the government and transaction takes place through websites (Garbade, 2011, p. 35). Comparison between B2B & C2C websites In Business to business transaction the companies offers products and services to the customers who are also business units. The buyer of the products and services use the products and services after buying into other production process which manufactures the final product from the buyer to sell to the customers. Whereas on the other hand in case of consumer to consumer business process the products from one consumer are listed by a third party on their web portal for viewing by other consumers to buy products from them. It is basically a process conducted through auction of material and goods to the consumers. Caterpillar, based at Australia is a classic example of business to business transaction system where the company produces trucks, engines and working machineries for the different companies who buy their products for different construction manufacturing purposes (Caterpillar, 2011). Caterpillar is ranked 11,621 at Australia for its traffic to the site by the viewers (Alexa.com, n.d.). The customers of Caterpillar (http://australia.cat.com/) are also business units who produce new goods from the raw material supplied to them rather than being the end user like the B2C or C2C. Whereas Ebay (http://ebay.com.au) is a C2C website who act as the third party between two parties buyers and the sellers. Ebay.com is not the producer of the products. It just acts as a mediator between the two parties to transfer products. In a B2B e-commerce the company is needed possess several infrastructures for conducting their business online. In case of Caterpillar, the company provides machineries for other companies thus after placing orders in their website the company need to maintain a logistics system with proper transportation and warehousing with distribution process. The machineries which are ordered are needed to be delivered without any problem from the company to the buyer. For the whole management of the customer data Caterpillar needs to maintain a customer database for farther contact and proceedings. The products from the company are displayed on their own website along with the specifications provided by the company to the customers. The company also have to maintain an inventory system, distribution management system and channel management system along with easy payment facility for the clients. In case of B2B transaction in most cases the transaction is carried out in hand between the customer and the buyer. Since the products offered by Caterpillar, incurs huge investment from the customers and proper inspection is required for the machineries and different products offered by the company customers prefer to see the products in hand before they pay for the products. This avoids the use of electronic payment system for the company. The transaction process for B2B transaction is carried out through Credit cards, debit cards or through ERP system in most of the business process for proper tracking of the payments done by the customers. This payment system also keeps track of the order processing and the settlement with invoices placed by the companies for future use. Figure 2: Caterpillar webpage Whereas on the other hand in case of customer to customer transaction system like ebay.com allows real time bidding of items over the internet and buy products from other consumers over the platform. The real challenge in C2C business operation is building trust in the mind of the customers to operate business in a successful manner. Since the products offered by the company are not their own manufactured products or services thus it depends on the consumers who supply the products for other users of the website. The company can only control the operation and transaction of goods from one user to the other. Products quality is not in the hand of the company which may ruin their business process. Ebay.com being one of the most popular website of Australia with a ranking of 6, primarily offers used products at auction price but the company also implemented a strategy to sell flat price products on their website (Alexa.com-a, n.d.). This gained popularity initially but with the growth in the fixed price product offering from the competitors, it affected the core business process of ebay.com which forced them to stick to their old strategy to sell auction price products in their website. Since the products offered in consumer to consumer basis marketing plays a vital role for ebay.com to build relationship with the customers and gain trust to use their service. Ebay.com provides ample option for the customer to pay in a convenient way for their services. Pay pal and credit card and debit card payment system are most used by the customers along with Pro pay, Money bookers and Pay mate systems (Ebay, 2011). Social networking helped a lot for the company to implement their strategies through advertisements and promotional activities on different websites to redirect to ebay.com. With relationship between the customers, the company gain trust to operate their business and the transaction is carried out in a smoother way where there is no direct contact of the company with the consumers of the products. Figure 3: Ebay.com webpage The bounce rate of australia.cat.com is much higher than ebay.com.au i.e. 39% compared to 20 % of ebay.com.au which depicts that more viewers of Ebay page explores about the company by browsing other links within the website rather than leaving the website just by going through the first page (Alexa.com, n.d.). This is one of the major successes of any website to keep the viewer within the website to increase the chances of selling products. In respect of popularity ebay is much more popular than caterpillar as according to the statistics more people search ebay products as compared to caterpillar with their key words. But on the other hand caterpillar website links are marketed much more than ebay with its presence on different websites to drive traffic into the website. Caterpillar has 1823 links compared to 1124 links of ebay at different websites (Alexa.com-a, n.d.). Demographically ebay.com.au is accessed from home on most cases whereas cat.com are much more accessed from workplace as it provides industrial equipments. Cat.com is more popular amongst people of age group of 25-34 compared to ebay.com which is most popular amongst age group of 35-65. Recommendation for improvements Caterpillar being a B2B website will have to promote their products in the industry sectors rather than focusing on all consumers. The niche segment of the market can only be reached by promotion and advertisements and review from the clients. The company should include a customer review section on their website so that more business units gain trust from the reviews and facilitate the process of buying from the company. Since the customers are not able to feel the products offered by the company at the very initial stage review can be a good addition for the company to attract customers to contact with the company for more information. Online payment system can also be introduced by the company for business units who are buying products of small value. Social networking being a great platform for building trust and connecting people from different parts of the world, Ebay.com need to promote their services on various social networking and product specific sites to drive traffic to the company website. The company should also implement strategies to introduce flat pricing on new products offered by the company to grab the market of its competitors on the particular section and expand its business process. Conclusion Caterpillar and Ebay.com.au both being Australian websites focuses on their Australian customers with their region specific websites. Caterpillar as a B2B website offers its products and service for the business units whereas ebay.com being a C2C website offers its services for consumer to another consumer. The two website have their own way of operating business as B2B website needs to focus on industry to offer its product whereas C2C website like Ebay.com concentrates on building trust amongst the people to carry out their business. Building trust amongst the target market is one of the vital activities for both the companies operating on different target market. The companies should implement strategies according to the need of the customers and provide a platform for better connectivity amongst the buyer and seller for a sustainable growth in the particular industry. Reference Alexa.com. (No date). Cat.com’s Regional Traffic Ranks. [Online]. Available at: http://www.alexa.com/siteinfo/cat.com. [Accessed on: August 13th 2011]. Alexa.com-a. (No date). Ebay.com.au’s Regional Traffic Ranks.[Online]. Available at: http://www.alexa.com/siteinfo/ebay.com.au. [Accessed on: August 13th 2011]. Caterpillar. (2011). Products & Applications. [Online]. Available at: http://australia.cat.com/products-and-applications. [Accessed on: August 13th 2011]. Cengage Learning. (No date). Course Technology. [Ppt]. [Accessed on: August 13th 2011]. Ebay. (2011). Choosing a payment method (for buyers). [Online]. Available at: http://pages.ebay.com/help/pay/methods.html. [Accessed on: August 13th 2011]. Garbade, M. (2011). Differences in Venture Capital Financing of U.S., UK, German and French Information Technology Start-ups: A Comparative Empirical Research of the Investment Process on the Venture Capital Firm Level. GRIN Verlag. Morley, D. Parker, C. (2009). Understanding Computers: Today and Tomorrow, Comprehensive. Cengage Learning. Shelly, G., Cashman, T., Rosenblatt, H. (2009). Systems Analysis and Design. Cengage Learning. Stair, R., Reynolds, G. (2011). Fundamentals of Information Systems. Cengage Learning. Read More