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You need to know the difference between e-business and e-commerce before actually running it. Even though both are done electronically, they both have differences.
Don't be misled and give the wrong name to the type of business activity you are doing. Although there are differences between e-business and e-commerce, they can be interrelated.
This depends on the type of business you do. E-commerce businesses sometimes need to do e-business to support performance. So, what is the difference between e-business and e-commerce? Check out the explanation in this article!
What is eCommerce
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E-commerce is sharing trading activities, both purchases and purchases made via electronic networks, which includes the internet network. These buying and selling activities can also be very broad, whether it is buying and selling goods or services, as well as transferring data and funds electronically.
E-commerce activities are divided into several types based on the nature and transaction relationships that exist between buyers and sellers. The following are the types.
- Business to business (B2B), is a form of e-commerce from sellers or buyers in the form of company organizations, whether small scale or large scale.
- Business to consumer (B2C), the seller of goods or services in this case is a company or organization, while the buyers come from individuals or individuals.
- Consumer-to-consumer (C2C), in this case, sellers and buyers are individuals who meet via the internet network to buy and sell goods or services.
- Business to employee (B2E), in this case, e-commerce is used by organizations or companies to provide various types of information to employees or employees which will later be used internally by the company.
- Mobile commerce (m-commerce), is the purchase of goods and services via wireless technology, for example the services contained in the iPhone service.
Understanding E-Business
Before knowing the difference between e-business and e-commerce, you must know the two meanings of these terms first
The definition of e-business refers to carrying out all types of business activities via the internet. These activities include procurement of raw materials, customer education, provision of products, transactions, and so on.
All e-business activities are carried out via internet, intranet and extranet services. Websites, applications, ERP (enterprise resource planning), CRM (customer relationship management), etc., are very necessary for e-business.
An example of e-business is a company that has an internal digital system, be it an e-commerce company or another type of company. There is a special system for conducting auctions, accessing important documents, developing software, hardware, and so on.
Sometimes the difference between e-business and e-commerce is just a matter of how the business is run. For example, if you are an interior design advisory company, then what you do is business. But if you run a website where people can compare existing furniture and interior design options, then your business is an e-business.
With increasingly advanced technology, it can be difficult to distinguish which businesses are truly doing e-business. Here are a number of examples to better understand e-business.
1. Email Marketing
Companies that do e-business tend to do marketing via e-mail to customers, potential customers and clients. This company carries out business processes electronically. In this case, marketing services or products.
2. Online System for Company Internals
E-business companies build and sell online systems for internal company use. For example, tracking inventory, warehouse management, and so on.
Warehouse management is a business process. When warehouse management is facilitated electronically, it will become part of e-business.
3. Content Management System
CMS or content management system, is a tool that the media needs. CMS was developed by IT developers to make the work of writers, editors, publishers and so on easier. This is also an example of e-business.
If there is no electronic workflow, paper movement of the manuscript will do this. By doing it electronically, the content management system becomes an e-business.
4. Online HR Management System
The HRD division usually carries out HR management by calculating wages, allowances, measuring KPI employee performance, storing employee data, and so on. When HRD does this through a digital system specifically created for HR management, it means that the company is already doing e-business.
Before knowing the difference between e-business and e-commerce, you also need to know detailed information about both. The definition of e-commerce refers to carrying out commercial activities online. Transactions are carried out via the internet.
E-commerce activities include buying and selling products, transactions, etc. via the internet. Websites and applications are needed to run e-commerce, in order to connect with end consumers.
The easiest example of e-commerce to find is a marketplace, such as Tokopedia, Shopee, Lazada, Traveloka, and so on. Compared with e-business, the definition of e-commerce is clearer. In its basic form, e-commerce places orders and makes payments online.
E-commerce takes various forms. One of them, B2C or business to consumer e-commerce, a business sells goods or services to consumers via a website.
Selling in e-commerce includes every element of sales. Starting from ordering products, paying for products, and making deliveries. It could also be that e-commerce only involves part of this process. For example, a customer orders a product online, but takes the product directly to the store.
A business can use several e-commerce sites at once, by using the Marketplace feature from SIRCLO Store which can expand the product market online.
With this feature, you can connect with all major e-commerce in Indonesia, integrate with several e-commerce at once in one dashboard, manage orders in one place, and receive sales reports.
Difference between E-Business and E-Commerce
After knowing the meaning of each, now we can easily understand the difference between e-business and e-commerce. Even though both are done online, there are significant differences between e-business and e-commerce.
In general, e-commerce can be said to be part of e-business. So that it is easier for you to understand the differences between e-commerce and e-business, here we present several points that can differentiate the two.
1. Online activities carried out
E-commerce is a transaction between a business and a customer carried out using the internet or online. Meanwhile, e-business is not limited to online transactions only. When carrying out e-business practices, the company will carry out all types of business activities by utilizing internet technology starting from the types of transactions provided, payment processes, marketing strategies implemented, and so on.
2. Internet use
E-commerce is electronic business that occurs with the help of internet technology. This is different from e-business, which in practice does not only require the internet but also intranet, extranet and offline.
3. The media used
The platforms used to carry out e-commerce transactions are websites or mobile applications. Meanwhile, e-business is much more diverse, starting from HRIS applications, ATS, websites, mobile applications, email, social media, CRM, ERP, and many more.
4. Business processes
When running e-commerce, the business focus is on external processes, namely the buying and selling process. Meanwhile, e-business is done to create a good online presence. So, e-business does not only focus on external activities but also internal business processes.
There are a number of points to describe the differences between e-business and e-commerce after explanation above.
First, e-commerce is better known as the activity of buying and selling goods and services via the internet. This is different from e-business, which is an electronic business presence. All business activities are carried out via the internet, but this does not necessarily include buying and selling activities.
Second, e-commerce is the main component in e-business. E-business activities can support activities that occur in e-commerce. When you have an online shop, you also need to have an application that can manage inventory or help with bookkeeping.
Regarding bookkeeping, we can move on to the third difference between e-business and e-commerce. E-commerce activities include transactions related to money, while e-business includes financial management activities, such as using the bookkeeping application.
Third, e-commerce has an extroverted approach. This is because e-commerce activities are directly related to customers, suppliers, distributors, and so on.
Meanwhile, e-business has an ambivert approach. E-business activities can include internal and external business processes.
Conclusion
So, basically e-commerce is an activity that utilizes the internet and websites in business transactions. Formally, this activity will allow for commercial transactions that involve organizations or companies and individuals.
Meanwhile, e-business is a business process that is carried out digitally and not only accommodates every transaction process, but also provides knowledge and information from within a company with a capable information and control system. So, if there is an exchange of value, then e-business will very likely transform into e-commerce
So, we can conclude that e-business refers more to information and communication technology that can be used well by companies, individuals or anyone.
This is done in order to maintain and manage the business so that it can generate large commercial benefits, such as optimization, flexibility, security, efficiency, integration, or increasing productivity and profits obtained.
However, whatever business model you want to run, you must be able to make good financial reports so that later they can be used as appropriate references in making business decisions.