Most companies realize that the Internet is here to stay. Business leaders realize that in order to maintain their competitive edge they
must become an eBusiness. But what is the difference between
eCommerce and an eBusiness, and how do you know if you are just a
business, have an eCommerce site, or are a true eBusiness?
Electronic commerce or "eCommerce" covers the range of on-line
business activities for products and services, both
business-to-business and business-to-consumer, through the Internet.
eCommerce breaks into two components:
Online Shopping - the scope of information and activities
that provides the customer with the information they need to
conduct business with you and make an informed buying decision.
Online Purchasing - the technology infrastructure for the
exchange of data and the purchase of a product over the Internet.
Online purchasing is a metaphor used in business-to-business
eCommerce for providing customers with an online method of
placing an order, submitting a purchase order, or requesting a
When you review information on products or services on the Internet,
you are carrying out online shopping. While online shopping you may
find a product you want to purchase, you place it in an online
shopping cart. When you are done shopping and are ready to buy, you
click a purchase button. You are then moved to a secure location to
carry out online purchasing on the product. To complete the
transaction, you need to supply your shipping address and credit card
number. These are the fundamental processes of online shopping and
online purchasing. These processes are the actions that are referred
to as eCommerce.
eBusiness is a super-set of eCommerce. One component of
transitioning your company from a traditional business to an
eBusiness is when you incorporate eCommerce into your company's flow.
For example, when your sales and fulfillment organizations can handle
web-based purchases equivalently to telephone and mail purchases, you
have started the transition to eBusiness.
Your web site may have other activates outside of eCommerce. Most web
sites, just like most brick and mortar shopping malls, have
activities other then eCommerce. For example, when you go to your
local shopping mall at Christmas you may find a Santa Claus. The
mall provides the Santa Claus as an activity that drives customer
traffic. The Santa Claus does not directly support shopping or help
customers purchase items at any of the stores, however it helps the
general sales environment for the mall. Similarly, you will have
shopping activities on your web site, e.g., product specifications,
customer testimonials, and product reviews. You may also have
purchasing activities on your site, e.g., order forms, shopping
carts, and credit card processing. To draw customers to your site
you may include promotional activities, e.g., eLearning courses,
entries for a raffle, discussion groups, or an advice columns.
"eCommerce" refers to the activities on your web site including
online shopping and online purchasing.
Many companies have an eCommerce site but are not yet an eBusiness.
eCommerce is the online selling component of a web site. eBusiness is
the integration of a company's activities including products,
procedures, and services with the Internet. You turn your company
from a business into an eBusiness when you integrate your sales,
marketing, accounting, manufacturing, and operations with your web
site activities. An eBusiness uses the Internet as fully integrated
channel for all business activities.
The following is an example of a company that has not yet become an
eBusiness: You visit a retailer's web site and buy a shirt. When
the shirt arrives it is in the wrong size. You decide to return the
shirt at the store's retail outlet instead of mailing it back to the
vendor. However, when you go to the store you are told that they
cannot take returns from their web site. Since the web site is not
integrated with the rest of their business activities this company is
not yet an eBusiness. If the company had integrated their web site
with their stores by providing access to their web site from within
the store, by accepting exchanges for sales made online, and by
training their people to support customers from/with their web site,
they would be an eBusiness. eBusinesses do not consider the web site
as a separate activity from their core businesses: The web site is
integral to all activities at an eBusiness.
Companies who are performing Businesses to Business activities become
eBusinesses when they integrate standard activities with their web
site. A salesperson considers their web site a sales tool. When
talking to a customer the sales person takes the customer to their
web site to give product presentations, provides the customer with
virtual tours of the newest products, or shows the customer how to
use a tool that the customer can use to configure their products.
The Marketing Department releases products on the website first,
providing online product presentations, eLearning courses, and
brochures. Customer Support uses the web site to host FAQ
(Frequently Asked Questions), support chat lines, and moderate
newsgroups. Purchasing uses the web to obtain prices on necessary
components and place orders, and Shipping uses the web to schedule
deliveries and notify customers of product arrival. Within an
eBusiness every department within the company treats the web as an
important tool they can use to move business ahead.
Is your company a business or an eBusiness? Most companies go through
the following series of phases as they evolve from a business to an
Phase 0: A company doesn't understand how they can take advantage of
Phase 1: An outside company is hired to create a web site. The web
site is static, containing little more than an on-line
brochure. Employees rarely reference the site or update it
with the latest information.
Phase 2: The Company decides to integrate eCommerce on the site.
Someone within the company is charged with placing product
catalog on-line. Salespeople consider the web site a
threat - not an integral tool to conduct business.
Phase 3: Everyone's internal Power Point presentations include Web
Site initiatives. None of these initiatives have been
Phase 4. The company starts implementing initiatives. The web site
responsibility moves in-house and is assigned to an
important member of the Senior Staff.
Phase 5: The web site becomes important to All of Senior Staff.
Initiatives are implemented; employees are focused on using
the web to conduct business. The company is becoming an