While e-business and e-commerce are both ways of doing business online, the terms are not interchangeable, referring instead to different degrees of a similar practice. E-commerce, the more-readily understood, refers to the realm of online business transactions, while e-business, a more-complex term, describes web-based practices that a business integrates into a variety of its functions.
Both e-business and e-commerce rely on the Internet to accomplish their goals. Business owners set up e-business and e-commerce systems through desktop and mobile devices, using basic concepts of data management and security, including servers, system management and legacy systems.
E-commerce focuses on appearance much more than e-business. E-commerce is primarily concerned with transactions, not only with customers but also with online suppliers and distributors. E-business applications strive to give a good idea of their company, promoting the values they use to market their business. As a result, e-commerce is much more concerned with user interface and advertising than e-business.
E-commerce typically requires a new or additional business model to govern online sales and services. This new model must include different methods of advertising, system management, security, marketing and the costs involved in maintaining an online website for business transactions. E-business, while it can use e-commerce strategies, tends to affect the existing business model more thoroughly, reinventing older processes.
While e-commerce is concerned more with the outside functions and appearance of the business, e-business is concerned with the inner workings of the company itself. E-business works to apply online solutions to payroll, human resources, internal data management and other systems that customer may not see but affect every part of the business.
The advantages of e-commerce are mostly market-oriented. It allows businesses to reach markets which they could not access before and show a new, up-to-date face for the company that may attract potential customers. The main advantage of e-business, on the other hand, is efficiency. While e-business strategies take longer to incorporate and are often more expensive, they create a more fluid, dynamic and efficient business model than before, increasing overall profits and growth.