The Advantages of C2C for the Marketplace Owner
C2C eCommerce websites are a specialized type of eCommerce platform with several advantages over the traditional B2C marketplace eCommerce models. A C2C business:
- Needs no inventory – Since a C2C platform is just the intermediary taking a cut of the C2C transaction, inventory is a non-issue. This avoids tying up capital in inventory and eliminates the need for storage and shipping facilities. It also does away with shipping costs associated with a business-to-business business model. (Get a better B2B eCommerce definition here.) Just charge a listing and/or final value fee without the risk of having inventory like when they sell products on brick-and-mortar stores.
- Needs fewer staff – A business without inventory needs no packers, shippers, or drivers.
- Creates sellers out of buyers – Buyers who become familiar with a website as a buying platform may recognize it as a legitimate place to become a seller. This is when it becomes a true customer-to-customer experience, where consumers sell products to other customers when once they were simply the buyer.
- Gets to choose their level of involvement – User agreements dictate just how involved a C2C platform is involved with the customer-to-customer business transaction. For example, Kickstarter's user agreement states that it cannot be held responsible for the contract between the creator and their backers.
- Isn’t responsible for forgeries – Tiffany and Co. took eBay to court, claiming that eBay profited from forgeries of their high-end merchandise. Courts decided that C2C sites like eBay are not legally responsible for forgeries sold on their site.
Pros and Cons of C2C for Buyers and Sellers
Now it's time to take a look at C2C eCommerce's pros and cons for the users of the platform.
Advantages for Sellers
C2C platforms give sellers the ability to list an item for sale without additional advertising, marketing costs, or legwork. The platform owner takes care of things like quality control and promotional features.
A seller is also able to take advantage of the marketplace's web presence to put them at the top of many search engine results. Not only can this type of eCommerce help sellers reach a larger audience than they could independently, but they can do it faster as well.
Sellers also benefit because they can change their level of involvement from day to day, where a traditional business would keep them busy day in and day out. In other words, C2C creates an excellent opportunity for “side hustles,” much like running ongoing garage sales in an online environment.
Advantages for Buyers
Buyers also benefit from C2C websites. Because the seller controls the pricing and can avoid the overhead costs associated with traditional retail companies, buyers can take advantage of this lower price that a retail company might not provide. They also get the promise of quality control that you impose on the sellers.
C2C commerce also offers shopping-from-home comfort for buyers. When done well, a well-designed C2C marketplace is a win-win for both buyers and sellers alike.