E-Commerce
“Electronic commerce, commonly written as E-Commerce, is the trading in products or services
using computer networks, such as the Internet. Electronic commerce draws on technologies such as
mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online
transaction processing, electronic data interchange (EDI), inventory management systems, and
automated data collection systems. Modern electronic commerce typically uses the World Wide
Web for at least one part of the transaction’s life cycle, although it may also use other technologies
such as E-Mail.
E-Commerce businesses may employ some or all of the following:
• Online shopping websites for retail sales direct to consumers,
• Providing or participating in online marketplaces, which process third-party business-
to-consumer or consumer-to-consumer sales,
• Business-to-business buying and selling,
• Gathering and using demographic data through Web contacts and social media,
• Business-to-business electronic data interchange,
• Marketing to prospective and established customers by E-Mail or fax (for example, with
newsletters),
• Engaging in pretail for launching new products and services.
Pretail (also referred to as pre-retail, or pre-commerce) is a sub-category of E-Commerce and online retail for
introducing new products, services, and brands to market by pre- launching online, sometimes as reservations in
limited quantity before release, realization, or commercial availability. Pretail includes pre-sale commerce,
pre-order retailers, incubation marketplaces, and crowdfunding communities.”
Difference between Traditional Commerce and E-commerce
1. Traditional Commerce :
Traditional commerce refers to the commercial transactions or exchange of information, buying or selling
product/services from person to person without use of internet which is a older method of business style and
comes under traditional business. Nowadays people are not preferring this as it is time taking and needs physical
way of doing business.
Example includes physical market/bazaar.
2. E-commerce :
E-commerce refers to the commercial transactions or exchange of information, buying or selling
product/services electronically with the help of internet which is a newer concept of business style and comes
under e-business. Nowadays people are preferring this as it is less time taking and does not need physical way of
doing business everything can be done with laptop or smartphone and internet.
Example includes online shopping sites.
S.No
. TRADITIONAL COMMERCE E-COMMERCE
Traditional commerce refers to the commercial
transactions or exchange of information, buying E-commerce refers to the commercial transactions or
or selling product/services from person to person exchange of information, buying or selling
01. without use of internet. product/services electronically with the help of internet.
, In traditional commerce it is difficult to establish In e-commerce it is easy to establish and maintain
02. and maintain standard practices. standard practices.
In traditional commerce direct interaction through In e-commerce indirect interaction through seller and
03. seller and buyer is present. buyer occurs using electronic medium and internet.
Traditional commerce is carried out by face to E-commerce is carried out by internet or other network
04. face, telephone lines or mail systems. communication technology.
In traditional commerce processing of transaction
05. is manual. In e-commerce processing of transaction is automatic.
In traditional commerce delivery of goods is
06. instant. In e-commerce delivery of goods takes time.
07. Its accessibility is for limited time in a day. Its accessibility is 24×7×365 means round the clock.
Traditional commerce is done where digital
08. network is not reachable. E-commerce is used to save valuable time and money.
Traditional commerce is a older method of
business style which comes under traditional E-commerce is a newer concept of business style which
09. business. comes under e-business.
10. Its resource focuses on supply side. Its resource focuses on demand side.
In traditional commerce customers can inspect In e-commerce customers cannot inspect products
11. products physically before purchase. physically before purchase.
Its business scope of business is a limited Its business scope is worldwide as it is done through
12. physical area. digital medium.
For customer support, information exchange For customer support, information exchange there is
13. there is no such uniform platform. exists uniform platform.
E-Commerce : key features
Feature # 1. E-Commerce is Technology-Enabled:
Traditional commerce is taking place since times immemorial but E-commerce is result of integration of digital
technology with business processes and commercial transactions. The technological foundations of E-commerce
are internet, WWW and various protocols.
Feature # 2. Technology Mediated:
In E-commerce buyers and sellers meet in cyber space rather than physical place. Hence E-commerce does not
involve face to face contact.
Feature # 3. Universality:
Buying and selling take place through websites in E-Commerce. The websites can be accessed from anywhere
around the globe at any time therefore it possess the feature of universality.
Feature # 4. Intercommunication:
E-commerce technology ensures two way communications between buyer and seller. On one hand by using E-
commerce firms can communicate with customers through E-commerce enabled websites. On the other end,
customers can also fill order forms, feedback forms and can communicate with business operating firms.
Feature # 5. Delivery of Information:
, E-commerce serves as the best channel of communication. E-commerce technologies ensure speedy delivery of
information at very low cost and considerably increase information density as well.
Feature # 6. Electronic Completion of Business Processes:
By using E- commerce we can perform business transactions like accounting and inventory through computers
at global level.
Feature # 7. Virtual Communities:
Virtual Communities are online communities created by means such as chat rooms and specifically designed
sites like, where people can interact with each other having common interest using the internet.
Feature # 8. Inter-Disciplinary in Nature:
Implementation of E-Commerce needs a lot of knowledge of managerial, technological, social and legal issues.
Besides this, understanding of consumer behaviour, marketing tools and financial aspects is as crucial as
designing interactive E- Commerce websites.
Feature # 9. Customization:
With the use of E-commerce technology, the world is moving from mass-production to mass-customization.
Product customization ensures that goods are tailor made as per the requirements and preferences of customers.
E-Commerce – Advantages:
E-commerce provides the following main advantages:
(i) Convenience – Customers can order products or services 24 hours a day wherever they are.
(ii) Information – Customers can find reams of comparative information about companies, products, competitors
and prices without leaving their office or home.
(iii) Fewer Hassels – Customers don’t have to face sales people or open themselves upto persuasion and
emotional factors, they also don’t have to wait in line.
(iv) Quick Adjustment to Market Conditions by Marketers – Companies can quickly add products to their
offering and change prices and descriptions.
(v) Lower Cost – On-line Marketers avoid the expense of maintaining a store and the costs of rent, insurance
and utilities.
They can produce digital catalogues for much less cost than the cost of printing and mailing paper catalogues.
(vi) Relatively Building – On-line marketers can dialogue with consumers and learn from them. Marketers can
download useful reports or a free demo of their softwares.
(vii) Audience Sizing – On-line Marketers can learn how many people visited their web site and how many of
them shopped at particular places on the site. This information can help them improve offers and
advertisements.
(viii) On-line Marketing – It is easy affordable by small firms, who otherwise would not have been able to
advertise in the print or broad cost media.
(ix) E-Commerce – E-commerce through Internet and web site can access and retrieve information very fast,
compared to overnight mail and even fax.
(x) Large and Medium – These companies have designed their own websites to automate corporate purchasing.
The high cost on invoices and purchase order copies including time are saved a great deal due to E-commerce
and Internet phase.
(xi) Internet newsgroups set up for commercial purposes help companies place on-line advertisements and thus
save cost and time.
(xii) New groups, Bulletins board systems (BBSs) and Web committees help also buyers, sellers and people in
general to have access to valuable information on diverse topics including information of cultivation for
farmers.
E-Commerce – Disadvantages:
1. Security:
Security continues to be a problem for online businesses. Customers have to feel confident about the integrity of
the payment process before they commit to the purchase. Banks such as ICICI Bank, HDFC Bank, State Bank of
India have added secure payment gateways to process online banking transactions quickly and safely.
“Electronic commerce, commonly written as E-Commerce, is the trading in products or services
using computer networks, such as the Internet. Electronic commerce draws on technologies such as
mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online
transaction processing, electronic data interchange (EDI), inventory management systems, and
automated data collection systems. Modern electronic commerce typically uses the World Wide
Web for at least one part of the transaction’s life cycle, although it may also use other technologies
such as E-Mail.
E-Commerce businesses may employ some or all of the following:
• Online shopping websites for retail sales direct to consumers,
• Providing or participating in online marketplaces, which process third-party business-
to-consumer or consumer-to-consumer sales,
• Business-to-business buying and selling,
• Gathering and using demographic data through Web contacts and social media,
• Business-to-business electronic data interchange,
• Marketing to prospective and established customers by E-Mail or fax (for example, with
newsletters),
• Engaging in pretail for launching new products and services.
Pretail (also referred to as pre-retail, or pre-commerce) is a sub-category of E-Commerce and online retail for
introducing new products, services, and brands to market by pre- launching online, sometimes as reservations in
limited quantity before release, realization, or commercial availability. Pretail includes pre-sale commerce,
pre-order retailers, incubation marketplaces, and crowdfunding communities.”
Difference between Traditional Commerce and E-commerce
1. Traditional Commerce :
Traditional commerce refers to the commercial transactions or exchange of information, buying or selling
product/services from person to person without use of internet which is a older method of business style and
comes under traditional business. Nowadays people are not preferring this as it is time taking and needs physical
way of doing business.
Example includes physical market/bazaar.
2. E-commerce :
E-commerce refers to the commercial transactions or exchange of information, buying or selling
product/services electronically with the help of internet which is a newer concept of business style and comes
under e-business. Nowadays people are preferring this as it is less time taking and does not need physical way of
doing business everything can be done with laptop or smartphone and internet.
Example includes online shopping sites.
S.No
. TRADITIONAL COMMERCE E-COMMERCE
Traditional commerce refers to the commercial
transactions or exchange of information, buying E-commerce refers to the commercial transactions or
or selling product/services from person to person exchange of information, buying or selling
01. without use of internet. product/services electronically with the help of internet.
, In traditional commerce it is difficult to establish In e-commerce it is easy to establish and maintain
02. and maintain standard practices. standard practices.
In traditional commerce direct interaction through In e-commerce indirect interaction through seller and
03. seller and buyer is present. buyer occurs using electronic medium and internet.
Traditional commerce is carried out by face to E-commerce is carried out by internet or other network
04. face, telephone lines or mail systems. communication technology.
In traditional commerce processing of transaction
05. is manual. In e-commerce processing of transaction is automatic.
In traditional commerce delivery of goods is
06. instant. In e-commerce delivery of goods takes time.
07. Its accessibility is for limited time in a day. Its accessibility is 24×7×365 means round the clock.
Traditional commerce is done where digital
08. network is not reachable. E-commerce is used to save valuable time and money.
Traditional commerce is a older method of
business style which comes under traditional E-commerce is a newer concept of business style which
09. business. comes under e-business.
10. Its resource focuses on supply side. Its resource focuses on demand side.
In traditional commerce customers can inspect In e-commerce customers cannot inspect products
11. products physically before purchase. physically before purchase.
Its business scope of business is a limited Its business scope is worldwide as it is done through
12. physical area. digital medium.
For customer support, information exchange For customer support, information exchange there is
13. there is no such uniform platform. exists uniform platform.
E-Commerce : key features
Feature # 1. E-Commerce is Technology-Enabled:
Traditional commerce is taking place since times immemorial but E-commerce is result of integration of digital
technology with business processes and commercial transactions. The technological foundations of E-commerce
are internet, WWW and various protocols.
Feature # 2. Technology Mediated:
In E-commerce buyers and sellers meet in cyber space rather than physical place. Hence E-commerce does not
involve face to face contact.
Feature # 3. Universality:
Buying and selling take place through websites in E-Commerce. The websites can be accessed from anywhere
around the globe at any time therefore it possess the feature of universality.
Feature # 4. Intercommunication:
E-commerce technology ensures two way communications between buyer and seller. On one hand by using E-
commerce firms can communicate with customers through E-commerce enabled websites. On the other end,
customers can also fill order forms, feedback forms and can communicate with business operating firms.
Feature # 5. Delivery of Information:
, E-commerce serves as the best channel of communication. E-commerce technologies ensure speedy delivery of
information at very low cost and considerably increase information density as well.
Feature # 6. Electronic Completion of Business Processes:
By using E- commerce we can perform business transactions like accounting and inventory through computers
at global level.
Feature # 7. Virtual Communities:
Virtual Communities are online communities created by means such as chat rooms and specifically designed
sites like, where people can interact with each other having common interest using the internet.
Feature # 8. Inter-Disciplinary in Nature:
Implementation of E-Commerce needs a lot of knowledge of managerial, technological, social and legal issues.
Besides this, understanding of consumer behaviour, marketing tools and financial aspects is as crucial as
designing interactive E- Commerce websites.
Feature # 9. Customization:
With the use of E-commerce technology, the world is moving from mass-production to mass-customization.
Product customization ensures that goods are tailor made as per the requirements and preferences of customers.
E-Commerce – Advantages:
E-commerce provides the following main advantages:
(i) Convenience – Customers can order products or services 24 hours a day wherever they are.
(ii) Information – Customers can find reams of comparative information about companies, products, competitors
and prices without leaving their office or home.
(iii) Fewer Hassels – Customers don’t have to face sales people or open themselves upto persuasion and
emotional factors, they also don’t have to wait in line.
(iv) Quick Adjustment to Market Conditions by Marketers – Companies can quickly add products to their
offering and change prices and descriptions.
(v) Lower Cost – On-line Marketers avoid the expense of maintaining a store and the costs of rent, insurance
and utilities.
They can produce digital catalogues for much less cost than the cost of printing and mailing paper catalogues.
(vi) Relatively Building – On-line marketers can dialogue with consumers and learn from them. Marketers can
download useful reports or a free demo of their softwares.
(vii) Audience Sizing – On-line Marketers can learn how many people visited their web site and how many of
them shopped at particular places on the site. This information can help them improve offers and
advertisements.
(viii) On-line Marketing – It is easy affordable by small firms, who otherwise would not have been able to
advertise in the print or broad cost media.
(ix) E-Commerce – E-commerce through Internet and web site can access and retrieve information very fast,
compared to overnight mail and even fax.
(x) Large and Medium – These companies have designed their own websites to automate corporate purchasing.
The high cost on invoices and purchase order copies including time are saved a great deal due to E-commerce
and Internet phase.
(xi) Internet newsgroups set up for commercial purposes help companies place on-line advertisements and thus
save cost and time.
(xii) New groups, Bulletins board systems (BBSs) and Web committees help also buyers, sellers and people in
general to have access to valuable information on diverse topics including information of cultivation for
farmers.
E-Commerce – Disadvantages:
1. Security:
Security continues to be a problem for online businesses. Customers have to feel confident about the integrity of
the payment process before they commit to the purchase. Banks such as ICICI Bank, HDFC Bank, State Bank of
India have added secure payment gateways to process online banking transactions quickly and safely.
