With the rise of digital commerce, there are two terms that are often used interchangeably: “e-commerce” and “e-business.” 

However, these two concepts are different and serve different purposes and uses. Although these strategies can work hand-in-hand, knowing the difference can make your business more successful.

If you are looking to start selling online, you need to know the difference, how to apply it to your business, and quickly get up to speed on the intricacies of these concepts so your business can quickly start realizing sales and be set up for success.

E-Commerce vs. E-Business: What You Need to Know

As you venture into business ownership and online selling, building a good foundation is imperative. 

Knowing the intricacies and differences between both e-commerce and e-business will help you be successful as you start your business and start working towards your sales goals. 

What is E-Commerce?

Ecommerce
Source:imatrix.com

E-commerce refers to the selling and transaction of goods and services online. This can be done through websites and online stores. In the most traditional sense, e-commerce is common for businesses selling physical goods and products to a consumer. 

But, e-commerce can span multiple business models and account for the transaction of services or solutions as well. 

In recent years, businesses have shifted to include e-commerce as a key element of their revenue operations. Some have even shifted to an only e-commerce model and completely away from a brick and mortar or physical-retail business model. 

Benefits of E-Commerce

If you are considering whether e-commerce is the right strategic approach for your business, there are a ton of advantages to e-commerce over traditional in-person-only retail.

  • Overcome geographic limitations: With a physical retail location, businesses are limited to selling to people in a specific location. With the introduction of e-commerce, geographical limitations are eliminated and the audience size has dramatically increased. This benefit ultimately leads to an increase in revenue and brand reach for your business. Your business will no longer rely solely on foot traffic or word-of-mouth marketing.
  • Lower costs: Having an e-commerce store can mean that you are saving on costs associated with traditional retail expenses like staffing a physical store, rent, utilities, and more. This cost savings can help bolster the business’s bottom line and even allow you to invest in strategic marketing–like search engine marketing or paid social advertising–to reach your target audience.
  • Provide more information: With a physical, in-person selling model, information sharing is limited to how well your salesperson can pitch, what you can fit in the physical location, and more. With e-commerce, you can include price comparisons, benefits, reviews, additional resources, and more, all within one listing. This can also be set up so it’s navigable by the buyer and they can ultimately choose the information they would like to see. 
  • Expand your hours of operation: Gone are the days of opening at 10 a.m. and closing by 10 p.m. (or whatever times your business ran). With e-commerce, you can keep the lights on 24/7. This always-on approach allows buyers to shop and browse at any time. Expanding your hours of operation can mean more opportunities for sales to come through, passively, without the need to pay staffing overhead.

Types of E-Commerce Business Models

There are four main types of e-commerce business models:

  1. B2C (business-to-consumer): This e-commerce business model is the approach of selling goods or services directly to an individual consumer. Some common examples could be when an individual decides to purchase a kitchen appliance or a piece of clothing.
  2. B2B (business-to-business): This e-commerce business model is the approach of selling goods or services to another business. A good example of B2B e-commerce is where an e-commerce business sells video production services to help support a company’s marketing campaigns or if a software company is selling a contract management tool to support an entire organization.
  3. C2C (consumer-to-consumer): This e-commerce business model is where an individual consumer sells a product or service to other individual consumers. A good example of C2C is where an individual sells something through an online marketplace like Etsy or eBay.
  4. C2B (consumer-to-business): This model is where an individual consumer sells their product or service to a business. An example of C2B is when an influencer offers to promote the business’ product or service to their online audience.

What is E-Business?

E-Business

E-business is the facilitation of business activities through online and marketing technology solutions. Essentially, e-business refers to any business that incorporates online technologies into their business strategies–no matter if they are an online-only, hybrid or in-person-only business.

What’s more, e-business does not mean that a business is solely an e-commerce business but this can also account for online activities physical retail locations use to drive foot traffic to their brick and mortar store.

Benefits of E-Business

Every business should consider what their e-business activities include. E-business can result in a lot of benefits for your business including:

  • Cheaper marketing costs and more efficient tactics: Traditionally businesses have relied on advertising agencies or outside contractors to create marketing materials and promote their brand. Now, thanks to e-business, there are ways to control product representation and company brand within their own systems. Or, even invest in cheaper alternatives like paid social advertising. Some tactics could include content marketing (like a company blog or social), email marketing and more. 
  • There’s still a place for the in-person experience: Because the goal of e-business is ultimately to support both e-commerce and in-person business, there is still a place for the in-person experience to thrive. The advantages of e-business do not take away from consumers who choose to interact with your brand in-person. In fact, having a great integrated e-business and in-person strategy will make the consumer’s experience better and more memorable.
  • The office can be anywhere: With e-business, you can promote your brand and run your business from anywhere, at any time. Thanks to technology, as a business owner, you can stay engaged and ensure that operations are running smoothly, no matter the time or day or where you are located.
  • Less restrictive hours for consumers: With e-business, you open up your business to more hours that suit a wider audience and their unique buying behaviors. What’s more, a variety of options are available to consumers like delivery or in-store pick-up which ultimately allows the consumer to choose their experience with your business. With the ease of access to information and products, there is an easier and more leisurely experience for customers. 

Types of E-Business Business Models

Like e-commerce, there are multiple e-business models to know about and consider.

  1. Pure Play: This e-business model is where all efforts and resources are invented into a single line of business. An example of this is that a business might only sell custom baseball caps that they invest their entire e-business activities into and nothing else would be considered pure play. One notable consideration, however, is that a business makes some sales online and some offline at a physical location.
  2. Bricks and Clicks: This is an e-business model that operates and generates sales through both online and offline channels. An example of bricks and clicks would be a physical store that sells clothing but they also provide an option for consumers to place orders through their online store. 

What Approach Is Right For You?

Knowing the difference between e-commerce and e-business, as well as the benefits and business models, will ultimately set you up for success as you embark on your online and/or in-person selling journey. 

Online selling can be highly profitable and beneficial and it all starts with knowing the right strategies and approaches BEFORE you invest a lot of effort into selling. Ask yourself important questions about how you want to run your business and which activities you want to invest in. 

E-commerce and e-business can work hand-in-hand but it’s imperative that you are being strategic and making the right investments for success.