May 17, 2021 (Updated: May 4, 2023)
Individuals and organizations that own and operate businesses fall under three main categories: business-to-business (B2B), business-to-consumer (B2C), and consumer-to-consumer (C2C). While B2B and B2C companies operate with more than a single team member, a C2C is just what it sounds like: when an individual personally sells a product or service to another individual. Think eBay, Etsy, and even Facebook Marketplace. And with the era of growing interest in freelance and contract work, understanding the C2C landscape can actually help businesses and brands connect to larger audiences. So how does it all work? This guide to C2C explains everything you need to know.
Image via Unsplash by Cytonn Photography
C2C is when customers sell directly to other customers, typically using a third-party platform. Before the internet and the evolution of e-commerce, consumer-to-consumer sales would most frequently occur at places like flea markets, farmers markets, consignment shops, and swap meets. In a C2C business model, you’re using your platform to support individuals who want to sell their products or services to other individuals.
You’ll see the best examples of this business model in practice on Etsy and eBay. These platforms provide hosting services for individuals selling used or handmade products. Other platforms, like Craigslist, provide ways for individuals to promote and sell their services—like lawn maintenance, pet sitting, or child care.
Back before the Internet was as popular as it is now, C2C would mostly occur at flea markets, through the classified section of a newspaper, or at a garage sale. Now, with the ever-growing world of cyberspace, there are distinct sites that are considered C2C platforms.
Just as anything in life, there are advantages and disadvantages when it comes to C2C facing e-commerce. The sellers can keep their costs low while getting a higher margin. Simultaneously, consumers save time by being able to search online for what they’re looking for, versus driving aimlessly from store to store. The only true disadvantage to C2C is that the quality of a product is not always definitive, and payment processes can be faulty or not secure.
Generally, there are four types of C2C businesses:
Online auctions allow consumers to search and bid on items that other consumers want to sell. This takes place on third-party platforms where consumers and sellers have profiles that allow transparency between users.
E-commerce sites allow consumers to create their own online store and expand their audience within a niche market.
Money transfer platforms allow consumers to participate in financial transactions without necessary accounting departments. Money transferring platforms accept payments in a controlled and secure environment.
Social media sites have features for members/users that allow them to reach a wider audience and promote their products. Social media C2C sites utilize hashtags and sponsored advertisements to drive visits.
Below is some information on the more popular C2C platforms and what they’re all about.
Etsy is a global marketplace for creative goods. Whether it’s home décor pieces to artsy photos, Etsy has a ton of handmade one-of-a-kind products. Etsy started in 2005 and is now a public company with over $360 million of total funding and sales that reached $1 billion in 2013.
The Etsy community is comprised of creative “artists” in a sense that have taken their craft and turned it into a business. Each artist has their own shop and becomes the seller. Consumers then peruse the platform to find exactly what they’re looking for, being met with sellers and shops from virtually all over the world. The core of Etsy comes from wanting to keep a form of human connection among an Internet transaction. Thus, there are specific company principles and site features that allow for transparency from both sellers and buyers.
Etsy is a C2C that truly helps both the sellers and buyers. Artists are able to create a business for themselves, while consumers are able to purchase unique products that meet their needs. The sellers could be individual artists or a small group of artists. As a seller, you choose your shop name, decide pricing, and pick tags to associate your products with search terms. Consumers are able to shop by price point, communicate with the seller/shop, rate and review products, and even return products if necessary.
The Etsy platform has been such a success in the C2C world primarily because it appealed to people whose needs were not being met. Prior to Esty’s inception, people had to rely on hoping their friends were crafty enough to help them with their unique gift idea; or wait for a craft fair, or pray for a good flea market find. Furthermore, because Etsy became such a trusted site, consumers are more likely to purchase from complete strangers because the Etsy site itself secures all transactions. If you had to trust a stranger with a personalized gift you wanted, you may not be so quick to give them money; whereas, from the artist side, you may not want to waste your time and skill on a piece you may never earn money from. Etsy knew of these struggles and really moved in on this niche market of art, crafts, and vintage items and have been flourishing ever since. As of 2020, Etsy had more than 4.3 million sellers from 234 countries.
Another C2C platform is eBay, one of the world’s largest online marketplaces founded in 1995. The way eBay works is a seller lists an item they wish to get rid of and chooses either to accept bids or set a fixed price. If the bid option is selected, consumers participate in an auction environment, placing bids on the item for a certain number of days. Once the time is up, whoever has the highest bid wins the item. If the seller chooses to have a set price, a consumer willing to pay that price right off the bat receives the item.
There are a plethora of items and categories on eBay, ranging from appliances to furniture, collectible items to vehicles, and even domain names. When people go to search eBay, more often than not they aren’t going to browse – they are going to find an item at a cheaper price than they’ve seen in the B2C market. Due to this, it’s a good C2C platform for people who are looking to sell in bulk or resell. This also means that the sellers who will do best financially are the ones that are in trend with what’s hot in the market. So if phone accessories and smart gadgets are currently flying off shelves, that’s more than likely what people are searching eBay for. The site also offers a free trend tracker for sellers to be able to view an inside marketing perspective.
Amazon, which was founded in 1994, is probably the most iconic online marketplace in the world. It is both a B2C and a C2C that is headquartered in Seattle, Washington. Many people are unaware that Amazon actually started as a bookseller, but by 1999 the company had transformed to selling consumer electronics, video games, software, home items, toys, and more. Amazon allows consumers to list items to sell to other consumers, as well as established businesses.
As a consumer looking to sell products on Amazon, it could prove challenging to make your way to the top of the results page, but once you do – it will be extremely beneficial, as Amazon is usually most people’s “go to” site for whatever they need.
Facebook Marketplace is one of the newer platforms for C2C e-commerce. More than one in three people within the U.S. utilize Facebook Marketplace each month to either buy or sell things. Facebook Marketplace allows Facebook users to discover, buy, and sell items based on their location, category they’re looking for, and budget.
The Marketplace is considered a good option for selling items, as there are more than one billion active monthly users. In addition, Facebook Marketplace is user-friendly and provides a seamless experience for both buying and selling. Similar to Etsy, there is a way to communicate with the sellers, which consumers find to be very helpful.
Just as any regular physical business, e-commerce has certain elements that impact success. Trust, quality control, payment, marketing capabilities, and social media are among the top qualities that affect the success of C2C e-commerce.
Just as anything in life, there are advantages and disadvantages when it comes to C2C e-commerce. From the seller’s point of view, a huge benefit is that costs can remain low, but margins can remain high. Additionally, probably what is viewed as the greatest advantage of C2C, is that the seller can reach a larger audience fairly quickly. As any businessperson will tell you — the larger the audience, the greatest potential for generating higher revenue.
From a consumer’s point of view, the biggest advantage to C2C is the convenience factor. Rather than driving all over town and searching aimlessly for what you’re looking for, comparing prices, and/or finding the amount of the product you need, you can simply search online and find it instantly.
C2C can be challenging in terms of handling payments in several aspects. If the seller doesn’t get their money ahead of purchase, they may not be able to have the money to make the product in the first place; but if the consumer pays for a product that isn’t in existence yet, they could potentially not receive their product at all. Likewise, if the consumer doesn’t like the quality of the product, the seller does not always have to provide a refund.
If a C2C business model seems like the right choice for you, there are some guidelines to keep in mind for a successful start.
Whether you choose to use a well-known e-commerce site, or simply create your own, marketing strategy is key in standing apart from the millions of other C2C businesses.
Some things to keep in mind when aiming to market your C2C brand:
If you’re selling customized home décor on Etsy, you may be wondering how content relates at all. Well, to be a top seller, you have to prove your products are not just the best in quality, but that as a seller you’re the most knowledgeable, professional, and experienced. One way to show off such traits is through effective content marketing.
So how do you prove your brand is top notch? You begin by producing and publishing relatable content on a regular basis to create a brand presence. You don’t need to be a big business to have a brand identity. You, as the seller, are a brand in itself. You need to promote your brand through your content.
Back to the Etsy example — If you’re selling handmade home décor, you could create a blog site where you talk about materials you’re using, design ideas, etc. Maybe you utilize recycled materials in your work and you can boost your sustainability efforts. Or maybe you have a story that powered your craft or got you in to the C2C world to begin with. Your content is a conversation starter, and people want to feel like they know you and you’re trustworthy before they make a purchase.
Concurrently, if your C2C e-commerce business deals with something you have studied, went to school for, received recognition on – show your expertise through content. Go into detail with your skill base. You don’t want to come off as condescending, but you shouldn’t be happy with coming off like you’re new to something if you’re an old pro. Find the happy medium in talking yourself up, but still being open to learn more. This will also make you seem more human and more likable which could impact sales.
Search Engine Optimization (SEO) plays a huge role in getting your site listed at the top of a search engine’s result page. SEO is the umbrella term for a series of tools that when used correctly, brings your content to the top of search engines. It’s a way of persuading search engines that your page contains exactly what the user is searching for and allows for organic traffic to be generated to your page.
You can improve your site’s SEO in large by reviewing keywords. Keywords are terms or phrases that people are searching for and are determined by three things:
Consumer to consumer facing e-commerce can provide a really great opportunity for certain products and individuals. Determining how to make your C2C successful can be a little difficult in the beginning, but with the proper tools, understanding, and mindset – you could very well be on your way to the creation of the next big e-commerce platform.
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