Do you know the difference between e-business and e-commerce? Have you been using these terms endlessly and wondering if you are really using them correctly? In order to have a better understanding of these two terms, let us define each of them separately.
Electronic commerce or electronic commerce covers commercial activities that are carried out through the Internet or other electronic systems. In electronic commerce, products and services are bought and sold over the Internet and transactions are completed automatically. E-commerce websites have the ability to accept online orders through a payment function provided by the e-commerce software or shopping cart. Electronic commerce is based on the use of technologies such as electronic funds transfer, online marketing, supply chain management, data collection systems, inventory management systems, and electronic data interchange.
Ecommerce software solutions use all of the technologies listed above to create fully functional eCommerce websites. E-commerce websites are also called virtual storefronts or virtual shopping malls, because they are known to be product catalogues. Stores that sell products rather than services can offer both tangible and intangible products, such as digital downloads of music, software, or books. To put this in simple terms, eCommerce is online commerce. All business transactions are carried out exclusively through the Internet.
Electronic commerce or electronic commerce, on the other hand, is considered the integration of electronic commerce activities in the commercial flow of your company. For example, you have a business and decide to start accepting purchases made online, then your business has gone from being a traditional business to an e-business. When e-commerce activities become an integral part of your overall business, that’s when you can call your business an e-business. Businesses that integrate standard activities on their websites are called e-businesses because their website becomes a sales tool to generate even more profit.
An e-business is more difficult to maintain because merchants have to manage both the website and their other internal business functions, such as the production of goods or services, product development, finance, human resources, etc. Most traditional businesses transition to e-businesses because they can attract more customers through the World Wide Web. It also makes your business look more professional and legitimate because customers can easily contact you through your website or search your business profile for more information about your business.
The terms e-business and e-commerce are often used interchangeably, but they must be used correctly so that people know the true nature of each. Now that you have a good idea of what differentiates the two, which direction do you want your business to move in? Include it in your business plan so you have the right goal to aim for.
