Types of online store: Which one to choose + 4 examples

What types of online stores exist? How do I know which one is right for my business?

When developing a business plan to develop an online store, it is important to know what ecommerce business model and types of online store exist to see which one best suits your product or business.

In this guide, we classify the types of online stores based on different criteria.

Online Stores by Product Type

A. Physical products:

As their name suggests, they are stores that focus on selling tangible items, such as books, clothing and accessories, furniture, etc.

B. Digital products:

A digital product is a file, items that cannot be touched. They may be:

PDFs / e-books
Templates
Songs or sounds
Plugins or other digital tools (not SaaS)
Images
And many, many more

The main advantage of these products is that the costs of creating and distributing them are minimal compared to the costs of producing physical products.

C. Services:

In this case, it is not a product that is being sold, but a job. Something we are experts at.

Some possibilities are:

Training courses.
Tutorials.
Consultancy.
Professional services.
Leisure and activities.

If your idea is to open this type of business, you may be interested in affiliate marketing, in which you recommend a third-party service based on your experience in exchange for a commission for each sale or for attracting new affiliates.

Online Stores According to the Business Model

Below is the classification of types of online stores according to their business model:

B2C (Business-to-Consumer):

They are online stores that sell their product or service directly to individual customers. It is the most common type of business model and generally, with more competition, depending on the demand and supply of the product.

B2B (Business-to-Business):

These are companies that sell to other companies or organizations. For example, product manufacturers that supply other online stores.

C2C (Consumer-to-Consumer):

These platforms serve to connect two end clients, providing the platform. Some success stories related to e-commerce are eBay or Etsy.

C2B (Consumer-to-Business):

They are usually platforms on which individual clients offer their products or services for companies to buy or contract.

The most common examples are platforms for freelancers such as Fiver or Upwork, where users offer their services or qualities to be selected by companies looking for self-employed workers for a certain project.

Online Stores According to the Platform that Manages it

A. Open source platforms

Open source software allows you to create your online store for free, although there are different levels and it will require maintenance. Some examples of open source platforms are:

WooCommerce (for WordPress) : The simplest, but also the one that offers the fewest options. It is the right one if you sell a few products or already have an existing website in WordPress and you are familiar with this CMS.
PrestaShop : with this CMS you can create a much more powerful online store, but it will require technical knowledge. It is a good platform if you plan to sell many products, with different variants and options.
Magento : the most complex option. It’s very powerful, but you need to know a little bit of coding (and it requires more money).

If you opt for an open source platform, the ideal would be to contact a developer specialized in the platform, so you can save time and costs.

B. Software as a Service (SaaS)

This software operates in the cloud and is managed from the platform’s own servers, offering different modules (products, shipping, marketing) that allow you to manage your online store without having to install plugins or tools.

As an advantage, you will not have to worry about hiring hosting or maintenance, you just have to pay a subscription to use the platform.

On the other hand, a drawback is that the online store will not be 100% owned by you and you depend on an external supplier, which can cause your online store to be limited in the long term.

An example is Shopify, you can read our review on Shopify .

Online Stores According to the Profit Model

Direct sale:

The businessman assumes all the risk when selling the product, logistics and stock storage, although the profit margin is usually higher. It is generally used by manufacturers, who alternate between selling directly to the consumer (B2C) and other retail suppliers that sell their products (B2B).

Dropshipping:

Although Dropshipping is a very popular modality at the moment, it has always existed. Basically, an online store sells a product which it does not have in stock and the manufacturer or distributor is responsible for shipping the product to the final consumer.

This means that the entrepreneur does not assume as much risk and the investment is minimal, although it reduces the control he or she has throughout the entire value chain. It is important to look for suppliers of nearby, quality products to ensure customer satisfaction, since in the end you will be the one who faces delays in shipments or product quality.

It is a good option to save costs at the beginning or test products.

Subscription:

The subscription model for online stores is a good option for long-term customer retention, since users pay an amount to enjoy a product, whether monthly, quarterly or annually.

Some examples of products from online stores that can implement the subscription model include beauty products, pet food at home, baby products or dietary supplements.

This model does not necessarily need to sell physical products, it can also offer exclusive benefits to members in exchange for a subscription fee (as is the case with Amazon Prime).

Advertising:

Earning income is based on advertising or sales commission generated by the online store, offering products and advertising from other third-party stores.

It is a risk-free model, although it is difficult to scale and you will need a lot of traffic to make them profitable.

An example is Lions Home , an online furniture and home decoration platform that aggregates product offers from other online stores, meaning that if they buy through its platform, they earn a commission.

Are you Ready to Choose one of the Types of Online Stores Mentioned?

By choosing the right type of virtual store for your business, both e-commerce brands and consumers win.

Therefore, whether you already have a physical business and want to create an online store or are thinking about opening one, it is important to take into account the different types of online store.

Now, let’s remember the steps to choose which of the types of online store best suit your budget, needs and business with a checklist:

Choose the type of product you are going to sell (physical, digital or service).
Determine what your market niche and end customer (end customer, company) is.
Create your pricing model (Subscription type or fixed price).
Choose an eCommerce platform (open source or SaaS).
Set up an order management system (own, Dropshipping).
The way to generate income from your online business.

We hope that this guide has given you an idea of the types of online stores that exist and the characteristics of a store.

Do you have any ideas about the types of online stores mentioned? Tell us in the comments!