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Consumer-to-business (C2B) is a business model in which consumers (individuals) create value and businesses consume that value. For example, when a consumer writes reviews or when a consumer gives a useful idea for new product development then that consumer is creating value for the business if the business adopts the input. Excepted concepts are crowd sourcing and co-creation.
C2B model, also called a reverse auction or demand collection model, enables buyers to name or demand their own price, which is often binding, for a specific good or service. The website collects the demand bids then offers the bids to participating sellers.
Another form of C2B is the electronic commerce business model in which consumers can offer products and services to companies, and the companies pay the consumers. This business model is a complete reversal of the traditional business model in which companies offer goods and services to consumers (business-to-consumer = B2C). We can see the C2B model at work in blogs or internet forums in which the author offers a link back to an online business thereby facilitating the purchase of a product (like a book on Amazon.com), for which the author might receive affiliate revenues from a successful sale. Elance was the first C2B model e-commerce site.
C2B is a kind of economic relationship that is qualified as an inverted business type. The advent of the C2B scheme is due to:
- The internet connecting large groups of people to a bidirectional network; the large traditional media outlets are one-directional relationships whereas the internet is bidirectional.
- Decreasing costs of technology; individuals now have access to technologies that were once only available to large companies (digital printing and acquisition technology, high performance computers, and powerful software).
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