When we run a business that uses electronic media, we often refer to our business as e-commerce or e-business. At first glance, the two words sound similar and in fact, the two words are related. However, e-commerce and e-business are different things, so don’t make the mistake of doing business. Before we dive into the differences, let’s have a look at the definitions of each!
What is e-commerce?
E-commerce is an abbreviation of electronic commerce, which is the process of buying and selling a product, which can be in the form of goods and services, through electronic networks and internet networks. The sale can also be in the form of an electronic transfer of data and funds. Hence, e-commerce refers to conducting commercial activities online. Examples of e-commerce that we often find are in the form of a marketplace, such as Tokopedia, Shopee, Lazada, Traveloka, etc.
Types of e-commerce
- Business to Consumer (B2C)
A business sells a product or service directly to the final consumer. Similar to retail stores where businesses need a warehouse for stock storage, the transaction process is carried out online.
- Business to Business (B2B)
Businesses sell products or services to other businesses. Products or services that are made are usually in the form of necessities to run a business such as raw materials etc. and of course, transactions are made online.
- Consumer to Consumer (C2C)
Transactions of goods or services between consumers and consumers. Usually, this transaction is carried out with the marketplace as a platform to help post and promote products.
- Consumer to Business (C2B)
Consumers offer their products or services to a business. Consumers make offers with online platforms and transactions are also carried out via electronic media.
What is e-business?
E-business refers to carrying out all kinds of business activities over the internet such as acquiring raw materials, customer service, stock calculations, transactions, etc. E-business facilitates business through the use of the internet, but it does not mean that the business is run entirely online. E-business uses online media to improve business processes that run offline. If you’ve heard of ERP (enterprise resource planning), CRM (customer relationship management), and so on, these things are part of e-business.
Difference between e-commerce and e-business
From the definition that has been read above, we can see the conclusion about the difference between e-commerce and e-business. Both of them are developing companies in the digital era, where companies use internet media and technology. However, what distinguishes it is that e-business is an extension of e-commerce, where e-commerce only includes transaction processes in business while e-business also includes other long-term processes such as collaboration with consumers, business partner relations, product marketing, supplier management, etc.
After looking at the differences above, we can see that both e-commerce and e-business are not that different but differentiate how we design our business models. If your business focuses on using electronic media only on transactions, then your business falls in the e-commerce category. But if your business also uses electronic media for other long-term processes, then your business is included in e-business. Simple isn’t it?