Consumer to consumer, or C2C, is the business model that facilitates commerce between private individuals. Whether it’s for goods or services, this category of e-commerce connects people to do business with one another. The other three categories of e-commerce are B2B (business to business), C2B (customer to business) and B2C (business to customer).
A solid example of C2C transactions would be the classifieds section of a newspaper, or an auction. In both cases, a customer – not a business – sells goods or services to another customer. A more high-tech version of this is the rise of apps like Letgo and OfferUp that allow consumers to sell to their neighbors. Letgo boasts 75 million downloads and 200 million listings since 2015.
The goal of a C2C is to enable these relationships, helping buyers and sellers locate each other. Customers can benefit from the competition for products and easily find products that may otherwise be difficult to locate.
Thanks to the internet, bigger intermediary companies have fostered more C2C interaction. The most prominent examples of C2C include eBay, an online auction site, and Amazon, which acts as both a B2C and a C2C marketplace. eBay has been successful since its launch in 1995, and it has always been a C2C. Anyone can sign up and begin selling or buying, giving an early voice to consumers in the e-commerce revolution.
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Craigslist is another well-known site where people can buy and sell goods, as well as trade services. With more than 20 billion page views per month, this classifieds site creates a community feel in the C2C business model. Craigslist does not facilitate the payment or processing of money, however – it simply facilitates the relationships, whether between a landlord and potential renters, or someone seeking specific services and the expert who can provide them.
Even Facebook Marketplace is in on the fun. It is now being used by 800 million people in 70 countries, and it only connects you to people in your precise location. According to the CEO Mark Zuckerberg, one in three people uses the platform. Its popularity might be attributed to the fact that it’s free, when other services, such as eBay, take a 10 percent transaction fee on sales.
C2C has several benefits for users. There are minimal costs involved with the lack of retailers and wholesalers, keeping the margins higher for sellers and prices lower for buyers. There is also the convenience factor – instead of trying to sell items in person at a brick-and-mortar store, consumers can simply list their products online and wait for buyers to come to them. Buyers don’t need to drive around and search through stores for an item they want – they just search for it on a C2C site.
Services are also available for sell through certain C2C programs. Mobile platforms have opened up the C2C field with a number of specialized service apps. Airbnb is a platform that allows users to post their residence for short-term lodging to other users for a nightly rate. Fiverr allows users to post a personal for-hire service for as low as $5. These services range from giving financial advice to graphic design. [Interested in e-commerce software? Check out our best picks.]
Most C2C sites make their money from fees or commissions charged to sellers for listing items for sale. C2C sites act simply as intermediaries, matching buyers to sellers, and they have little control over the quality of the products being sold. PayPal is a money transfer platform that’s often used to facilitate transactions for C2C sales, usually charging a small transfer fee. But this market is also evolving, thanks to the rise of C2C payment platforms such as Venmo and Google Pay.
Companies often try to prevent the sale of illegal goods or services, such as pirated CDs or drugs with a comprehensive selling policy. Violations of the policy can result in banning the user from further using the platform.
But C2C is not without its problems. Credit card payments can be difficult, as the platforms are not necessarily secure and able to process such payments. There is a lack of quality control – since the sellers are consumers themselves, there is little recourse for poorly made or misrepresented products. On the flip side, because the buyers are consumers themselves, the payment guarantees can be hard to enforce.
It’s also worth noting that C2C platforms can be rife with scams. Opportunists have found workarounds to take advantage of others. If using a C2C platform watch out for sellers that are unable to answer detailed questions about items for sale, pressure you to buy immediately, won’t accept cash or meet in person.