C2C, which stands for Consumer-to-Consumer, is the exchange of products or services among consumers. Nowadays, we mostly use this term when referring to trading goods online.
The rise of social media has significantly expanded C2C interactions, enabling consumers to connect and exchange goods through networks and community groups.
The term also stands for Customer-to-Customer.
Traditionally, people would participate in C2C commerce when selling or buying products at a flea market. Individual consumers could also interact commercially through newspaper adverts.
A flea market is an outdoor market where people sell second-hand, items, antiques, etc. In the UK, people call them ‘car boot sales.’
Millions of people buy and sell things to each other each day. They are C2C traders.
C2C process is simple
The consumer-to-consumer model differs from others because consumers interact with each other. The process of selling is relatively simple. It is much simpler than, for example, in the B2B or B2G worlds.
B2B stands for business-to-business, i.e., companies selling to other companies. B2G, on the other hand, means business-to-government.
In most cases, consumers need no marketing strategies because they can offer their products through different platforms online.
The consumer-to-consumer model has become progressively more popular since the advent of the Internet.
C2C – the Internet
Through the internet, individuals have been able to sell their products to bigger audiences over platforms or intermediaries.
Intermediaries have also increased consumer-to-consumer interaction, promoting engagement between users.
Amazon and eBay, for example, are two giant intermediaries.
- eBay is an online auction site that enables consumers to trade with each other at any time.
- Amazon has a B2C and C2C mix, i.e., it lets businesses sell to consumers and consumers sell to consumers.
B2C stands for business-to-consumer, i.e., companies selling to individual people.
Most websites will let purchasers buy freely. However, the seller must pay a fee or commission. The size of the fee depends on the exposure the seller requires.
Promoting your product for two weeks, for example, costs more than doing it for just one day.
Online C2C disadvantages
Like any type of business, consumer-to-consumer has some disadvantages. Methods of payment can sometimes be a problem. The quality of the product on sale can also be an issue.
Some C2C websites, however, have secure payment facilities.
PayPal, for example, lets people make and receive online payments.
Levels of quality may sometimes be a problem because some trades might be one-off exchanges. Also, many consumer-to-consumer trades are for second-hand goods.
In response to quality concerns, many C2C platforms have implemented rating systems, allowing buyers to review sellers and provide feedback on their transactions.
Online C2C advantages
For consumers, a consumer-to-consumer e-commerce model has its benefits. Users can keep their costs low and get a higher margin.
C2C sites offer a better deal because consumers can trade without having to sell at a brick-and-mortar store.
People can save time looking for the item they need online without having to drive all over town.
Size of the C2C e-commerce market and recent growth
The consumer-to-consumer (C2C) e-commerce sector has become a trillion-dollar market.
In 2023, the size of the C2C e-commerce market worldwide was estimated at $1.67 trillion. This includes online peer-to-peer transactions on sites like eBay, Taobao, Etsy, Craigslist, Facebook Marketplace, and sharing services like Airbnb.
Over the past decade, C2C trade has increased at a faster rate than traditional retail trade. Recent growth has been described by industry analyses as exponential, which has been due to increase in access to the Internet and mobile phones, development of online marketplaces and increased usage of digital peer-to-peer transactions by consumers.
The COVID-19 pandemic greatly contributed to the enhancement of this trend; lockdowns made people to trade their unused products online. At first, this increase was due to necessity and convenience; however, it has stuck through consumer’s interest in sustainable and pre-loved goods.
Future growth projections
C2C e-commerce is predicted to keep on growing at a healthy rate and annual doubles digit growth is forecast over the next few years globally.
It is estimated that by 2029 the C2C market could reach $11 trillion in terms of transaction value by the early 2030s. This projection indicates that the CAGR of the market may remain above 20%, which is significantly higher than the growth rate of the overall retail market.
Some of the factors expected to drive growth include:
- Expansion of online platforms to new areas
- Improved digital payment and logistics systems
- Mainstream adoption of reselling and sharing economy models.
Analysts point out that the continuing trends of seeking distinctive, affordable, and environmentally friendly products, as well as integrating social media into selling processes, will continue to drive C2C trade. Therefore, it is expected that C2C will remain one of the most dynamically developing segments of e-commerce in the next ten years.
Drivers of growth in the C2C market
Several factors have been responsible for the growth of the global C2C market.
- Technology Penetration: Annual billions of people getting internet and smartphone access.
- Rise of Social Media and Dedicated Apps: Reconfiguring casual selling, simplifying item postings, and expanding market reach.
- Change in Cultural Paradigm Towards Recommerce: Growing consumer concern for the environment, thus viewing C2C platforms as a way of prolonging the product’s life.
- Trust-Building Mechanisms: Buyer and seller reviews, risk buy and send funds tools, and escrow services that enhance the confidence of P2P transactions.
- Product Variety and Affordability: Reasonable prices and a wide selection of products including antiques, used clothes, and used electronics. These factors form a positive feedback loop that is likely to sustain participation and growth in the C2C market.
Video explanation
This video presentation explains what ‘C2C (Consumer-to-Consumer)’ means using simple and easy-to-understand language and examples.