Customer to customer (C2C or consumer to consumer) markets provide a way to allow customers to interact with each other. Traditional markets require business-to-customer relationships, in which a customer goes to the business to purchase a product or service. In customer-to-customer markets, the business facilitates an environment where customers can sell goods or services to each other. Other types of markets include business to business (B2B), business to government (B2G) and business to customer (B2C).
Consumer to consumer (or citizen-to-citizen) electronic commerce involves electronically facilitated transactions between consumers through some third party. A common example is an online auction, in which a consumer posts an item for sale and other consumers bid to purchase it; the third party generally charges a flat fee or commission. The sites are only intermediaries, just there to match consumers. They do not have to check the quality of the products being offered.
Consumer to consumer (C2C) marketing is the creation of a product or service with the specific promotional strategy being for consumers to share that product or service with others as brand advocates based on the value of the product. The investment into conceptualizing and developing a top-of-the-line product or service that consumers are actively looking for is equivalent to retail pre-launch product awareness marketing.
Origins There are many different classifications of marketing. From Government to Business (G2B), Business to Business (B2B), Business to Consumer (B2C), to Customer to Customer (C2C). While many companies usually operate in one or more of these areas, Customer to Customer businesses operate only within that specific area. Customer to Customer marketing has become more popular recently with the advent of the Internet. Services such as Craigslist, eBay, Facebook Marketplace, Mercari, OfferUp, and other classified and auction-based sites & apps have allowed for greater interaction between consumers, facilitating the Customer to Customer model. Furthermore, as it becomes more economical for individuals to network on the Internet via social websites and individual content creation, this marketing model has been greatly leveraged by businesses and individuals alike.
There are two implementations of customer-to-customer markets that are credited with their origin. These are classifieds and auctions.Yutaka, Kurihara, Nobuyoshi Yamori, and Sadayoshi Takaya. Global information technology and competitive financial alliances. Idea Group Inc, 2005. Print.
Newspapers and other similar publications were in frequent circulation and therefore were able to be used to facilitate a common need. Some people wanted things; other people had things and wanted to sell them. This was the birth of classifieds. The use of classifieds is referred to as classified advertisement. Normally used in text-based print, classified advertisement is now a strong vertical market that allows customers to communicate their needs with each other. In 2003, the US classifieds market totaled $30.00 billion for both newspapers and online classified ad services.
The oldest auction house is Stockholm Auction House (Stockholms Auktionsverk), which was established in Sweden in 1674. Auctions however, have been recorded as far back as 500 B.C. Deriving from the Latin word augēre, which means "to increase" or "to augment".Krishna, Vijay. Auction Theory. Academic Press, 2002. Print. Auctions have since been widely used as a method of liquidating assets, and have evolved into many different variations. The most successful current form of auctions is based on the Internet, such as eBay.
Business model Most C2C websites, such as eBay, have both streamlined and globalized traditional person-to-person trading, which was usually conducted through such forms as garage sales, collectibles shows, flea markets and more, with their web interface. This facilitates easy exploration for buyers and enables the sellers to immediately list an item for sale within minutes of registering.
When an item is listed on a C2C site, a nonrefundable insertion fee is charged based on the seller's opening bid on the item. Once the auction is completed, a final value fee is charged. This fee generally ranges from 1.25 percent to 5 percent of the final sale price.
After the C2C site sets up the system in which bids could be placed, items can be put up for sale, transactions can be completed, seller fees are charged, and feedback can be left, while the C2C site stays in the background. For example, at the end of an auction, the C2C site notifies the buyer via e-mail that he or she has won. The C2C site also e-mails the seller to report who won and at what price the auction finished. At that point it's up to the seller and buyer to finish the transaction independently of the C2C site.
C2C sites make money by charging fees to sellers. Although it's free to shop and place bids, sellers pay fees to list items for sale, add on promotional features, and successfully complete transactions.
Many C2C sites have expanded and developed existing product categories by introducing category-specific bulletin boards and chat rooms, integrating category-specific content, advertising its service in targeted publications and participating in targeted trade shows. eBay specifically has also broadened the range of products that it offers to facilitate trading on the site, including payment services, shipping services, authentication, appraisal, vehicle inspection and escrow services.
There are various platforms that Consumer-to-consumer e-commerce is taking place on, such as social media (e.g. Facebook, Reddit), advertisement websites (e.g. Craigslist) and online auction sites (e.g. EBay).
Product or service
Consumer-to-consumer transactions often involve products sold via either a classified or auction-like system. As such, the products and services bought and sold are usually varied in type and have a short development and sale cycle. Products sold may often be used or second-hand, since consumer-to-consumer sales are often facilitated through auction or classified sites.
Development
Since products are usually second-hand, surplus, or used, there is seldom a long development cycle associated with the products that are marketed via this method. However, in the case of individuals who are looking to sell a product or service they have developed to be sold on a small scale, there is a product development life cycle. However, even when a product goes through a development life cycle when marketed in this manner, seldom does traditional marketing research occur. Oftentimes individuals are looking to make a quick profit, and simply place their product in the marketplace in hopes that it will be sold.
Communications
Advertising Advertising is essential to the success of any business. In the case of customer-to-customer marketing, advertising often relates to online auctions and listings. As opposed to the high costs to advertise in media such as newspapers and magazines, products are already being promoted and publicized once users decide to officially put them on the internet. Potential buyers will become aware of products or services by conducting searches on the websites. Aside from possible fees and commissions imposed by the auction or listing site, advertising in this market does not require a substantial amount of money.
Advantages Customer to Customer C2C marketing has become very popular in recent years. Customers can directly contact sellers and eliminate the middleman. Moreover, anyone can now sell and advertise a product in the convenience of one's home – enabling one to easily start a business. Therefore, a wide variety of products can often be found on auction sites such as eBay, including second-hand goods. Since the majority of these sales occur over the internet, sellers can reach both national and international customers and greatly increase their market. Feedback on the purchased product is often requested to aid both the seller and potential customers. The actual buying and searching process is simplified and search costs, distribution costs, and inventory costs are all reduced. Moreover, the transactions occur at a swift rate with the use of online payment systems such as PayPal.
Disadvantages Although online auctions allow sellers to display their products, there is often a fee associated with such exhibitions. Websites may also charge a commission when products are sold. With the growing use of online auctions, the number of internet-related auction frauds has also increased. For instance, a seller may create two accounts on an auction site. When an interested buyer bids for an item, the seller will use another account to bid on the same item and thus increase the price. Consequently, many users have purchased products at unnecessarily inflated prices.
Identity theft has become a rising issue. Scam artists often create sites with popular domain names such as "ebay" in order to attract unknowing eBay customers. These sites will ask for personal information including credit card numbers. Numerous cases have been documented in which users find unknown charges on their credit card statements and withdrawals in their bank statements after purchasing something online. Unfortunately, websites often have a liability statement claiming that they are not responsible for any losses or damages. Furthermore, illegal or restricted products and services have been found on auction sites. Anything from illegal drugs, pirated works, prayers, and even sex have appeared on such sites. Although most of these items are blacklisted, some still find their way onto the internet.
Examples
E-commerce
Internet auctions Despite the success of eBay, numerous other online auction sites have either shut down or consolidated with other similar sites. Creating an innovative and efficient business model is vital to success. Online auctions can be categorized into five main models: C2C, B2C, B2B, B2G, and G2P. C2C refers to customer-to-customer, B2C signifies business-to-customer, B2B refers to business-to-business, B2G signifies business-to-government, and G2P refers to government-to-public. In recent years, online auctions have even appealed to major businesses. For instance, Sears has reported selling items at higher prices on these auctions when compared to discounting them in stores.