The crucial difference between ecommerce and ebusiness is that ecommerce means selling products online, while ebusiness describes any online business. While many people use these terms interchangeably, it’s important to understand the differences between the two as it will help you devise an ecommerce marketing strategy that’s tailored to your specific needs.
What is Ecommerce?
As a subset of ebusiness, ecommerce, also spelled as e commerce or e-commerce, focuses on a narrower scope of the internet: online sales. Ecom mainly pertains to monetary transactions online in exchange for products or services. Specifically, it involves an electronic means of payment – so a pizza ordered through a website or app, but paid for with physical cash, isn’t technically considered an ecommerce transaction. It is, however, an example of ebusiness. If the pizza was paid for online, then this becomes an example of ecommerce.
There are at least six categories of ecommerce to be aware of:
1. Business-to-Business or B2B Ecommerce
In B2B ecommerce, transactions occur between business entities, i.e. between two companies. As with all types of ecommerce, this means all online transactions completed through electronic means.
Products, services, technologies, and even expertise can be traded between companies using electronic money transfer. B2B relationships are oftentimes large-scale and wholesale transactions that may involve millions of dollars.
Business-to-business ecommerce doesn’t have to be explicitly between two B2B companies – it can also be a B2B company selling to a B2C, who then sells the products on to their own client base, such as a clothing manufacturer selling products to an online clothing brand. However, it’s important to note that B2B ecommerce isn’t the same as B2C ecommerce…
2. Business-to-Consumer or B2C Ecommerce
B2C ecommerce is the most common and well-known type of ecommerce. B2C ecommerce is the completed transaction between a seller and a buyer, who is the end user or consumer of the product – not a business.
B2C ecom has been made more dynamic and diverse by the developments of various online businesses and platforms. Indeed, all sorts of products can be ordered online nowadays, including both tangible and intangible products.
From ordering books on Amazon and paying for games on app stores to downloading software, buying clothes, and everything in between, B2C e-commerce activities dominate daily online transactions. They’re virtually ubiquitous – whether you’re using social media or just browsing the internet, online stores for consumers are advertised everywhere.
3. Consumer-to-Consumer or C2C Ecommerce
Whether you want to start a micro business or sell pre-loved items, there are several online platforms you can use to sell to other individuals.
For example, many people use social media, like Facebook Marketplace, to sell online, as well as peer-to-peer shopping apps like Depop or Vinted. Platforms like eBay are also examples of C2C ecommerce when the transaction is between two individuals.
4. Consumer-to-Business or C2B Ecommerce
The C2B ecommerce model may at first seem to be the reverse of the typical B2C model, but it’s actually more similar to hiring a consultant or an employee.
For example, an individual consumer may be hired by a business to promote or test a product. From loyal customers to online influencers, a company may hire a range of consumers to help market their products. Additionally, businesses will often hire freelancers to provide a service to them, whether it’s to design a website or create office artwork.
5. Business-to-Administration or B2A Ecommerce
Any ecommerce transaction between a business entity and a government regulator is classified as a B2A transaction. It’s also known as B2G, or business-to-government. This type of e-commerce may include complying with basic regulatory requirements, such as permits, or paying social security and health insurance for employees.
6. Consumer-to-Administration or C2A Ecommerce
A C2A ecommerce transaction is any electronic transaction between a consumer and a branch of government, agency, bureau, or regulatory body that’s completed online. It mainly includes applying for and receiving legal documents like your passport, driver’s license, and copies of your birth certificate. Fees for this type of transaction are now most commonly paid online and the documents sent electronically, making it a form of ecommerce.
Consumer-to-administration ecommerce also includes paying taxes, fines, bills…you name it. Because of the pandemic, an increasing number of C2A transactions are now happening online.
So, What’s Ebusiness?
Ebusiness covers all the activities that an online or internet-based business conducts, which includes purchasing supply, production, managing inventory, and, you guessed it, ecommerce. The difference is that ebusiness operations go beyond the online component. With that in mind, ebusinesses can be split into two categories:
- Pure Play
A pure play ebusiness is focused on one particular type of product or service, rather than having multiple and different types of products. For example, a SaaS startup company may either offer just one SaaS product or have multiple SaaS products – but it won’t sell hardware products.
By focussing attention on one specific product like this, pure play is a great way for a business to get a large market share. It’s also great for SME businesses that fit into a specific niche because it gives them the opportunity to dominate a specific market.
A brick-and-click ebusiness is a business that has an online presence, an offline presence, and a mode of operation. Aside from the website or online store, this type of business also has a brick-and-mortar, i.e. a physical store. Examples of brick-and-click ebusinesses include store chains like Walmart and most big clothing brands. Brick-and-click e-businesses allow you to either visit one of their stores, or shop on their website. They may also offer hybrid ways of purchasing, such as click and collect, which allows you to pay for something online and collect it at the physical store.
The Difference Between Ecommerce and Ebusiness
For some, ecommerce and ebusiness are almost synonymous and interchangeable terms. However, there are some crucial differences that should be kept in mind. This is the difference between ecommerce and ebusiness:
- Ecommerce is a component of ebusiness. The latter merely incorporates the use of online platforms, like websites and social media, into its business model – so, a physical store that extensively uses online marketing can be considered an ebusiness. Only when an online payment option is added does any completed online transaction become part of an ecommerce operation.
- An ecommerce business is completely reliant on online sales. By contrast, an ebusiness has different sources of revenue and income as well as ecommerce.
- An ecommerce business is focused on customers who are transacting online. An ebusiness includes offline transactions with business partners, suppliers, customers, the government, and other stakeholders.
- Ecommerce transactions are purely internet-based in nature. Ebusiness transactions, on the other hand, include transactions can be carried out in various ways, including physical payment options if it’s a brick-and-click ebusiness.