Updated for 2023: C2C eCommerce Marketplace Tips

What Is C2C eCommerce? A Marketplace

C2C, or consumer-to-consumer commerce, is often defined as one consumer selling goods or services to another consumer. When done online, C2C refers to consumer to consumer eCommerce. This C2C sale is often facilitated by a third party that takes care of the transaction details for a commission for bringing the parties—direct sellers and potential customers—together. C2C business examples include eBay, Amazon Marketplace, and Etsy that all work as online intermediaries. While one person might technically be the seller in such a situation, it’s considered consumer-to-consumer because that seller isn’t a traditional business.

The purpose of a consumer-to-consumer eCommerce platform is to enable one party to sell directly to buyers without spending a considerable amount of money building and maintaining an online storefront. This allows the seller to keep more of their profits because they aren’t expending the capital to create infrastructure associated with a traditional business.

The buyer may also get more competitive prices if sellers on the same C2C platform compete. The most common term for these types of eCommerce platforms is “marketplace.” The idea of a marketplace mirrors real-world examples like flea markets, where a building owner will offer booths to sellers in exchange for a percentage of the profits. Clarity’s own eCommerce platform creates these marketplaces for clients who want to take full advantage of C2C opportunities. We can build them from the ground up or combine them with another business model, such as a single online store, multi-store (i.e., many franchises connected to a single product database), global multi-currency market, customer to business eCommerce, and much more.

C2C eCommerce Examples

EBay is an excellent C2C business example where consumers can sell to other consumers online. It was the first customer-to-customer auction site on the web, even though Buy It Now listings currently eclipse those of timed auctions. EBay makes money by charging sellers fees for the privilege of connecting them to potential buyers. Buyers have multiple options for paying such as credit card, PayPal, or bank debits. This ability to accept a variety of payments is one reason sellers choose eBay over other sites. The seller then utilizes eBay’s shipping software to create labels and then ships using one of the three major package carriers.

Craigslist takes a much more altruistic approach. In most cases, it works as a free marketplace for consumers to connect with other consumers at the local level. Craigslist charges to post job ads to cover its expenses, but its primary purpose is to create a free C2C or business to comsumer eCommerce marketplace.

Amazon offers the largest marketplace on the web. Buyers pay with a credit card or PayPal, and sellers receive payments facilitated by Amazon to their own bank account or PayPal account. Amazon charges one of the highest rates of any C2C site on the web, but sellers continue to use it because of Amazon’s reach.

Consumer-to-consumer eCommerce websites are a specialized type of eCommerce platform with several advantages over traditional business to consumer e Commerce 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 B2B.
• 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.
• 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.

Advantages of Consumer-To-Consumer eCommerce

What is a consumer-to-consumer eCommerce able to do? C2C platforms give sellers the ability to list an item for sale without additional advertising, marketing costs, or legwork. 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.”

Buyers also benefit from consumer-to-consumer 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. 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.

The most challenging thing about customer-to-customer eCommerce is finding a platform that can handle all the functionality of a robust marketplace yet not cost millions of dollars to purchase and take years to set up. Clarity eCommerce offers such a platform, one that costs a fraction of what most global marketplaces costs. It can also be set up in weeks or months instead of the years you might spend waiting on other C2C software platforms, all while handling millions of SKUs and tens of thousands of buyers and sellers. It allows sellers to set up and brand their stores, upload and customize their pricing for both products and services, report on sales, track shipments, and much more. If needed, our platform can provide a multilingual, multi-currency model as well. What is C2C doing for our clients? Clarity created goAfrica.com, a marketplace similar to Alibaba but serving Africa. Within the first few months of being set up it had thousands of sellers and hundreds of thousands of SKUs…all being set up by the sellers themselves.

Disadvantages of C2C eCommerce

Handling payments can be one of the biggest challenges to C2C commerce. It can be hard for a seller to make a buyer pay for an item they already shipped if there is a problem with the buyer’s funds. Conversely, a seller might refuse a refund if the buyer receives a damaged or subpar item, which could alienate the buyer from the C2C platform itself. In this case, the marketplace is not to blame for shipping or product quality but suffers due to the actions of the seller.

Third-party consumer-to-consumer websites like eBay or Amazon usually help solve some of these issues because of the policies set up for both sides of the C2C transaction. Sellers are forced to accept these policies or face the prospect of losing the site as a selling tool. eBay even reserves the right to deduct funds directly from a seller’s bank account if a buyer demands a refund. Amazon also has guidelines for sellers if buyers have a justified reason for returning an item.

An escrow model can help solve many of these problems. One payment platform Clarity has used before, Payoneer, uses such a model. A portion of the purchase price is deducted and paid right away to the seller while the balance is held in an escrow account. Once the item has shipped and the buyer accepts delivery, the rest of the payment is released. This adds some protection to both sides of the transaction, especially when dealing with overseas payments, large transactions, and shipments.

A Robust C2C Business Model

A single person can create a traditional storefront for their small business in a matter of hours with simple website-building software. This just isn’t an option when building a custom C2C business platform. Off-the-shelf software and cheap websites simply can’t handle the traffic, the customer interface, and the millions of SKUs associated with C2C needs.

Clarity is ready to build your C2C platform to perfectly fit your business’ needs. We’ve built over 1,500 custom sites for companies across the country, providing robust security and top-tier interaction to help you realize your C2C needs. Our experience building other customer-to-customer software has also shown us what works—and what doesn’t work—in C2C business plans. Let us know what you want, and we’ll make it happen.

Integrated C2C Payment Processing

The ability to process payments has scared away more than one person who had a good idea for a business. They might be experts in their field but still be intimidated by the options and complexities of accepting payments, especially when there is an international element involved. If your only familiarity with online payments is with the Cash App, PayPal, or Venmo, Clarity can help you choose a much better payment processing option for your C2C platform from the dozens available. Best of all, these payment options are seamlessly integrated into the C2C software itself so that you can focus on growing the business.

Don’t worry about security when it comes to online payments. Clarity only uses payment processing programs that utilize the highest level of payment security so that you, your buyers, and your sellers feel confident using your platform. The best security builds trust in your customers so that they keep coming back. Want to know just how secure we can make your C2C platform? Let us show you in a free demo.

Building Customer Relationships with C2C

Easy communication is vital to every business, and a C2C platform is no exception. Most C2C transactions take place without the buyer and the seller ever having to contact each other. They will also occur without any problems that would require you to step in and take action.

Let’s look at these relationships and why it’s so important to make communication as easy as possible. First, consider the interaction of buyers and sellers. Buyers may want to ask specific questions about an item before they buy if sellers aren’t posting the necessary information. Sellers, on the other hand, want to communicate without having to switch to a dedicated email platform. Making communication easy on both sides of the transaction keeps customers coming back to your consumer-to-consumer eCommerce offering.

It’s also important to make sure anyone using your website — whether a buyer or seller — has the ability to reach you. Though they might be rare, problems will arise with transactions and someone at your company must deal with them. eBay has gotten so big that they have eliminated all ways to contact them, including phone, email, and chat. You won’t be surprised to learn they are losing sellers because of this silence, but it serves as an important lesson for C2C platforms to provide a more communicative environment.

Capturing Niche Markets with C2C

Many people wonder why they should consider C2C commerce when certain companies dominate the market. Large companies often run into the problem of spreading themselves thin as they get too big. eBay might facilitate selling everything, but they are an expert on nothing. Similarly, Etsy started as a site for artists to sell handmade items; sellers now use it to sell mass-produced trinkets and “vintage” tube televisions. This dilutes the brand and presents an opportunity for those seeking to enter the C2C market.

C2C commerce opens the door for anyone wanting to be the go-to site that specializes in a particular interest or industry. It doesn’t matter whether it’s industrial shelving or comic books, boats or camera equipment. You will run into competition, but you can dominate if you do it better than anyone else. Make the site more attractive, improve the checkout feature, and create a community. In other words, make your site so much more inviting that you become the default C2C facilitator for a particular industry or interest.