Consumer-to-consumer (C2C) is a type of electronic commerce that connects private citizens acting as final operators in the exchange of goods or services; it is based on the use of a web platform that facilitates economic transactions between users. The architectural model therefore provides for the presence of three actors: the buyer, the purchaser and the service platform provider. The latter generally does not have an active role in the transaction, but may charge a fee for the use of the platform; the terms of settlement of transactions are determined by the seller and the buyer.
The type and volume of data handled by the C2C service provider requires it to have high standards of IT security. Compared to direct electronic commerce, C2C generates very high traffic and high profits, so much so that many web companies have turned their attention to this market, also in view of the fact that it involves rather low operating costs since the companies involved in this sector play a simple role of mediation between users interested in buying and selling.
The consumer-to-consumer model has become particularly widespread with the growth of ecommerce but also of the sharing economy, thanks to the development of business and platforms that put in contact consumers who want to sell or buy goods or services.
In this sense, the C2C model differs from the B2C model precisely because of the existence of a direct interaction and exchange between two consumers (rather than between company and consumer), but always with the support of third parties (an online platform or a newspaper, for example) that facilitate the transaction in some way.
Advantages and disadvantages of a C2C business model
|Allows for the location of scarce or specialty goods
|There are higher rates of fraud
|Unites different geographic areas
|Sometimes the buyer may not be protected
|Higher margins and lower prices
|There is less quality control
|Larger selection of goods and services
|Payment isn’t always easy
|It makes buying and selling between individuals easy
|Possible problems with shipping of items
|Convenience for both parties
|Allows almost anyone to enter the marketplace
Types of C2C model platforms
- Auction platforms: let sellers list their goods at a minimum price and then allow multiple buyers to bid on the item until there’s a winner.
- Exchange of goods platforms: online platforms that connect buyers and sellers looking to exchange physical goods—from used furniture to artwork and anything in-between.
- Exchange of services platforms: buy and sell services.
- Payment platforms: C2C online payment platforms exist to list goods and services for sale and to facilitate payment for C2C sales on other platforms. These platforms may make money by charging users a small fee to transfer earnings into their own bank accounts.
C2C businesses expand passively through buyer and seller satisfaction, but face challenges with quality control and technology maintenance.