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E-commerce, e-business and digital business

In this article, we explore the differences between e-commerce, e-business and digital business.

E-commerce is a multi-disciplinary subject that comprises Business, Marketing, Computer Science, Management Information Systems and Business Law, making it difficult to find one agreed definition.

Some people use e-commerce and e-business interchangeably, however, these are two different concepts that have some degree of overlap. E-commerce is a subset of e-business, which includes:

  • Placing orders
  • Making payments online
  • Organising delivery of the order

E-business, however, covers most of the digital-related information exchange both inside and outside the organisation.

While e-commerce is the narrower scope of e-business, digital business (d-business) goes further and describes not only the buying and selling of goods and services, but also servicing customers, collaborating with business partners and conducting electronic transactions within an organisation.

Digital business refers to a digital business model where most of the business processes are digitally tuned and performed, not only buying and selling online.

In the following infographic, Gartner illustrates the differences between digital business (d-business) and e-business.

Truck with image of a shoe. Text at the top reads 'Analogue: Use technology to optimise relationships between people that drive business. Another part of the text reads 'We track shoe orders between the warehouse and the retail store.' This type of organisation is not yet an e-business. On the second row of the infographic, there is a computer display with an image of a shoe. The text reads 'Web: Use technology and the internet to extend relationships between people and business.' Another part of the text reads 'Our website tells people that we sell shoes.' This organisation is in the early stage of e-business. On the third row of the infographic, there is an image of a computer display with several shoes and a shopping cart. The text reads 'e-business: use technology to optimise channels by automating business operations and using the web to sell and drive efficiencies between people and business. The other part of the text reads 'Our website sells shoes.' This is an e-business. On the fourth row, there is an image of a person running and an image of a shoe. The text reads 'Digital business: We build new business models by extending potential customers from people to things. The other part of the text reads 'We promote our ultra marathon trainers to wearable fitness devices on people who run over 5 miles.' This is a d-business. On the final row, there is an image of a wearable device and a drone. The text reads 'Autonomous: Maximise our retention of and relationships with things.' The other part of the text reads 'Our customer's wearable device selects same day drone shipment of new trainers based on their skill level, style preferences, and product availability.' Adapted from Is your organization an e-business or d-business? (McCall, 2015, cited in Gartner, 2015)

Your task

Reflecting on the infographic above, which activities represent e-commerce? Share your responses below.

Further reading

Laudon, K., & Traver, Carol Guercio, author. (2017). E-commerce business, technology, society (Global edition [of] twelfth ed.). Locate link (Available to fee paying students)

References

McCall, T. (2015, February 18). What’s the key difference between e-business and d-business? Gartner. Web link

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