“Commerce” refers to the trade or the exchange of money, goods, and/or services. By contrast, “business” is an umbrella term that applies to all the activities and processes companies engage in throughout the day – including commerce.
This distinction remains intact even when you apply an “e” prefix to these terms to reflect the electronic channels throughout which modern e-commerce and e-business happen. In other words, e-commerce refers to any purchases made online – including the capture and transmission of payment details via the internet. E-business refers to all business activities and processes conducted through the internet or other electronic channels.
This short definition captures the core difference between electronic commerce and electronic business. This post will help to highlight some additional examples so you can better distinguish between e-commerce and e-business – and understand how using either (or both) can help grow your operations.
Ad campaigns, email marketing, and research and development all fall under the category of e-business. These activities often generate expenses that business owners may be able to deduct from their taxes. Companies take on these costs if doing so allows them to become more efficient, productive, or profitable.
By contrast, e-commerce specifically requires a transaction of some kind. While it’s technically possible to process payments offline, in-person, or with a merchant-facing virtual terminal, most online sales are initiated remotely by the customer – whether they pay via credit card, ACH, gift card, or some other digital payment option.
E-businesses can use software integrations and internet connectivity to automate, scale, or speed up many time-consuming processes that used to be done manually.
Many brick-and-mortar companies rely on a range of digital tools, including inventory management, customer relationship management (CRM), or accounting software. As such, they all qualify as e-businesses to varying degrees. However, a growing number of companies now manage their entire operations remotely – without ever needing to rent physical office spaces.
With e-commerce, merchants use the internet to connect their products and services with customers around the world. Just as with an e-business, managing an e-commerce store can be done entirely from any PC or smart device. As an online retailer, however, there is no requirement that your operations be 100% digital.
Against this backdrop, the differences between digital businesses and e-commerce are becoming less pronounced.
There’s a reason why e-business and e-commerce are on the rise worldwide. They both leverage internet technology and computational processing power to help you:
What used to take hours by hand can now be performed in mere seconds by computers. This has helped lower the barrier to entry, allowing startups to compete with more established businesses. Before moving your sales funnel or entire operations to the cloud, it’s important to understand some of the potential challenges involved.
Whether you’re looking to manage more of your business in the cloud, or are ready to start selling your products and services online, Clover has the tools to help your organization grow. To learn more about our e-commerce solutions and business insights, contact a Clover Business Consultant today.