E-Commerce and E-Business Questions

Table of Contents

Abstract ........................................................................................................................................... 2 What is the difference between e-commerce and e-business?........................................................ 3 Why do some people say B2B has greater potential than B2C?..................................................... 4 What type of e-business would benefit from disintermediation? ................................................... 5 What type of e-business would benefit from reintermediation? ..................................................... 6

References....................................................................................................................................... 7

Abstract

This paper answers four discussion questions concerning various electronic marketing concepts. First, the difference between e-commerce and e-business is discussed. Second, details are given why B2B has greater potential than B2C. Third, the concept of disintermediation is discussed and what type of business could benefit most from this concept. And finally, reintermediation as a concept is discussed and which type of business could benefit most from this concept.

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E-Commerce and E-Business Questions

What is the difference between e-commerce and e-business?

When one thinks of thinks of the two terms ‘commerce’ and ‘business’, little difference is found, and in many cases they are transposable when discussing business. However, there is a specific difference between e-commerce and e-business. E-commerce, which is short for electronic commerce, is in the simplest of terms business transacted electronically that involves money. The obvious example of e-commerce is selling products via the web, such as Amazon.com has been successful in doing.

E-business, on the other hand, is much more complex. E-business encompasses a plethora of items including marketing, procurement and consumer education. E-business goes beyond e-commerce and affects the processes developed for use by organizations. E-business infiltrates the entire organizational culture. In the implementation of e-business, vital business systems are connected to a variety of organizational partners including their customers, their vendors, other business partners, and even their employees.

Using the Internet, Intranets and Extranets e-business can create fully integrated supply chains. Customers can view real time information about their orders or stock on hand. Vendors too have access to their order status, allowing them to better schedule their production and delivery activities. These vendors can be made aware of customer demands, to allow them the flexibility to increase and decrease production when needed. The entire system can improve efficiencies across the supply chain.

Thanks to technology and e-business, the way organizations do business has changed. Gone are the days when to be competitive an organization needed to keep their customers and suppliers in the dark. Today, collaborative efforts are the key to success. However, there are disadvantages to the advent of e-business as well.

E-business has lowered the barriers of entry for many companies. These lowered barriers mean increased competition. Competition now also comes from global competitors thanks to ebusiness. Consumers now have more choices of who to make purchases from. In addition, consumers have become better informed thanks to technology. They now not only take a

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company’s word for it when describing the features and benefits of a product or service, they seek to prove their claims true or false. This increases the time that a buying decision takes oftentimes. In the end, “e-business includes e-commerce but also covers internal processes such as production, inventory management, product development, risk management, finance, knowledge management and human resources,” (Bartels, 2000) while e-commerce speaks specifically to transactions made online that involve money.

Why do some people say B2B has greater potential than B2C?

Before discussing why B2B (business to business) has greater potential than B2C (business to customer), one must first understand the differences in the two terms. B2B involves supply chain management. B2B websites are portals that transact directly with their vendors and their distributors via online technology. This strategy allows for the electronic transfer of orders, invoicing and payments.

B2C websites, however, are different. They act as liaison gateways that link customers to businesses. This is the more familiar of the two types and can be exemplified by companies such as eBay.com and Amazon.com. Their primary concern is selling to the end user, and they are primarily Internet based. B2C organizations develop offices and warehouses in response to online purchases, and as such, their costs are typically lower than traditional retail establishments.

Once one understands the differences between the two concepts, it becomes easier to see why B2B has more potential than B2C. B2B “encompasses many other types of services than just placing orders between businesses.” (Gittlen, 2000) In addition to servicing costumers, B2B can include joint design efforts as well as coordination of production and delivery. B2B is ebusiness, and therefore involves the entire supply chain. Not only is just the organization and customer’s relationship more effective and efficient, but the organization and vendor’s relationship is improved as well.

B2C is a singular type transaction, even in instances where customers make multiple purchases, it’s not a collaborative effort. B2B is collaborative. A relationship is formed and all parties involved can work together to improve competitiveness across the board. Even if someday consumers decide that they no longer value the convenience of shopping online, and

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