Practical Ecommerce

Ecommerce vs. Commerce: What’s the Difference?

I assume you are reading this because you sell products online — either in your own online store or through marketplaces. Here’s a question. When someone asks what business you are in, how do you typically respond?

  • “I sell (name your product).”
  • “I’m an ecommerce merchant.”
  • “Not really sure anymore.”
  • “I’m an online retailer.”

For many online sellers, the answer is likely “All of the above.” But many would also choose either “I’m an ecommerce merchant” or “I’m an online retailer.”

As a participant in ecommerce since 2002, I’ve witnessed an evolution in how ecommerce owners describe themselves. Back then, most business owners who sold products online described themselves as “ecommerce businesses” or “online retailers,” to differentiate from brick-and-mortar or catalog retailers. Most operated their own pure-play online stores. Some sold products on eBay. Amazon’s marketplace was mostly comprised of larger retailers.

As a participant in ecommerce since 2002, I’ve witnessed an evolution in how ecommerce owners describe themselves.

Today, I still hear many online sellers describe themselves as “ecommerce businesses” or “online retailers.” But, in 2014, those terms don’t really apply. Whatever you sell, you are delivering a set of products to meet the needs of a specific market. “Ecommerce” or “online retailing” is simply a technology and a sales channel.

It’s time to get rid of the “e” in ecommerce. Most businesses participate in ecommerce in some fashion. There is now no difference between “ecommerce” and “commerce.” You engage your customers in many different channels — your own ecommerce site, brick-and-mortar, online marketplaces. Regardless, you and virtually every other B-to-C or B-to-B company are selling goods to customers across those channels.

Make the focus of your business your customers and its value proposition, not the fact that you sell online. It’s time to simply answer the question of what business you are in with a response that is more or less, “I am a (distributor, retailer, reseller) of (name your products) for (name your market).”

Why Worry about Labels?

Business owners should think strategically. Part of strategic thinking is focusing on the bigger picture, such as having the right products and ensuring that your buyers can find them.

Today, commerce is multichannel and highly competitive. It’s done online, on the phone, face-to-face, and on desktop, mobile, and tablet devices. Make sure your business has an omnichannel strategy, so your shoppers can find you. Make sure the information about your company and products is consistent regardless of the channel. Focus on whom your prospective customers are, what they want to buy, and how much they are willing to pay.

Omnichannel Focus

Think about omnichannel commerce every day. Get your brand and products in front of your target customers regardless of where they are shopping. To facilitate an omnichannel strategy, consider the following.

  • Mobile. If you don’t have a mobile strategy, you need one.
  • Chat and phone. If you don’t offer online chat or take phone orders, consider doing so.
  • Marketplaces. If you aren’t selling your products in marketplaces outside of your own online store, consider doing so.
  • Payment options. If you only take credit cards for payments on your website, add alternative payments like PayPal, Google Wallet, or Amazon Payments.
  • Social media. If you don’t have a social media presence, your market share is likely declining.

Customer Focus

Twenty-five years ago, if you asked a brick-and-mortar retailer or a catalog vendor what business she was in, she would likely respond as, say, “jewelry retailer,” “men’s clothing store,” “a department store,” or “hardware store.” She knew her target customer niche, how to reach them, and what products they wanted to buy. Those businesses that did the best job of (a) matching products to the consumer, (b) offering low prices, and (c) utilizing the right distribution likely won most of the business.

It’s time to get back to that focus. It’s more challenging than it used to be because the purchase cycles are far more complex than in 2002. There is no longer a straight path from identifying the need to research to purchase. Now the buying cycle is like tangled spaghetti. Consumers typically identify a need and purchase intent, research products, research prices, research products further, conduct social media research, and then purchase a product and demand instant gratification and free shipping.

To be successful in 2014, commerce — not just ecommerce — requires the following.

  • First, make sure you know your target customers and what problems they are trying to solve or the need that you fulfill with your products. Know their demographics, their buying cycles, price tolerance, and where they research and shop.
  • Execute the 4 Ps of sales and marketing – “product,” “price,” “promotion,” and “place.”
  • Know your competitors. Amazon and Walmart are far different than Fancy.com and Fab.com.
  • Emphasize your value proposition. Regardless of how a shopper finds you, be sure he can quickly find out that you are a leading retailer of products in your market. Being clear on what your business is will also help establish trust with your shoppers.
  • Build and reinforce your brand. Invest in omnichannel branding. Present your company consistently regardless of the channel or conversation.
Dale Traxler
Dale Traxler
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Comment ( 1 )

  1. Jordan Lindberg January 26, 2014 Reply

    Agree completely, Dale. Maybe that’s not surprising as I’m the author of a column called “eCommerce is Commerce” but do think that too much emphasis is given sometimes to the differences between so-called “traditional” retail and online retail, rather than the structural and functional similarities. Some folks really have a hard time “getting” that, and yes, I’m pointing at you, banking industry.

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