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Difference between traditional commerce and e-commerce

febrero 27, 2020

The days are gone when commercial activities such as the exchange of goods and services for money, between the parties, take place only in the traditional way, that is, the customer must go to the market, look at the variety of products, choose the things required and buy them by paying the specified amount. But with the advent of e-commerce, people can buy goods, pay bills or transfer money with a single click.

Many people still prefer traditional commerce through e-Commerce, because of their dogma that the latter is unsafe, however, this is just a myth. Both modes have their pros and cons, so we've simplified the difference between traditional commerce and e-Commerce.

Comparative chart

Basis for comparison Traditional trade and E-Commerce
SenseTraditional trade is a branch of activity that focuses on the exchange of products and services and includes all those activities that encourage exchange in one way or another.e-Commerce means carrying out commercial transactions or exchanging information, electronically on the Internet.
Transaction processingManualAutomatic
accessibilityLimited time24 7 365
Physical inspectionGoods can be physically inspected before purchase.Goods cannot be physically inspected before purchase.
Interaction with the customerFace to faceScreen-to-face
Scope of activityLimited to a particular area.Worldwide reach
Exchange of informationNo uniform platform for information exchange.It provides a uniform platform for the exchange of information.
Focus resourcesSupply sideSide of the question
Business relationshipLinearFrom one end to the other
MarketingOne-way marketingOne-to-one marketing
PaymentCash, check, credit card, etc.Credit card, fund transfer etc.
Delivery of the goodsImmediatelyIt takes time

Definition of traditional trade

Trade or traditional trade a part of the business, which includes all those activities that facilitate exchange. Two types of business are included in trade, ie trade and auxiliaries for trade. The term commercial refers to the purchase and sale of goods and services for money or nature and auxiliaries to trade, implies all those activities such as banking, insurance, transportation, advertising, insurance, packaging and so on, which helps to complete successfully exchange between the parties.

In more precise terms, trade includes all those activities that simplify the exchange of goods and services, from the producer to the final consumer. When the goods are produced, they do not reach the customer directly, but must go through various activities, which are included in the trade. Its main function is to satisfy the needs of consumers by making goods available to them at the right time and place.

Definition of e-Commerce

E-Commerce or electronic commerce refers to the exchange of goods and services, funds or information, between businesses and consumers who use the electronic network, or the Internet or online social networks. e-Commerce means trading and providing assistance to trading activities, through the use of electronic means, that is, all activities such as buying, selling, ordering and paying are carried out on the Internet. The purpose of e-commerce discussed in the following points:

  • B2B commerce : when the commercial transaction takes place between two business houses, through the electronic channel, it is called B2B commerce.
  • B2C trade : when the exchange of goods and services takes place between the corporate entity and the customer, on the Internet, known as B2C commerce.
  • Trade C2C : when the purchase and sale of goods and services take place between customers who use electronic means, then it is called C2C trade
  • Intra-B trade : when the exchange takes place within the company or company, with the use of electronic media, it is called Intra B-commerce.

Key differences between traditional commerce and e-commerce

The following points are noteworthy regarding the difference between traditional commerce and e-commerce:

  1. Part of the business, which focuses on the exchange of products and services, and includes all those activities that encourage exchange, in one way or another, is called traditional commerce. e-Commerce means carrying out commercial transactions or exchanging information, electronically on the Internet.
  2. In traditional commerce, transactions are processed manually while, in the case of e-commerce, there is automatic processing of transactions.
  3. In traditional trade, the exchange of goods and services for money can only take place during working hours. On the other hand, in e-commerce, the purchase and sale of goods can take place at any time.
  4. One of the main disadvantages of e-commerce that customers cannot physically inspect the goods before purchase, however, if customers do not like the goods after delivery, they can return them within the stipulated time. Conversely, in traditional trade physical inspection of goods is possible.
  5. In traditional commerce, direct interaction between buyers and sellers, that is, face to face. On the contrary, in the case of e-commerce there is an indirect customer interaction, because it may be possible that the customer is miles away from where he places an order for the purchase of goods.
  6. The purpose of business in traditional commerce limited to a particular area, i.e. the scope of business limited to the nearby places in which it operates. On the contrary, the activity has worldwide reach in the case of e-commerce, thanks to its ease of access.
  7. Since there is no fixed platform for exchanging information in traditional commerce, the company must rely on intermediaries to obtain complete information. Unlike e-commerce, where there is a universal platform for the exchange of information, i.e. an electronic communication channel, which reduces people's dependence on information.
  8. Traditional trade is about the supply side. In contrast, the focus of e-commerce resources on the demand side.
  9. In traditional commerce, the vertical or linear business relationship, while in the case of e-commerce there is a direct command that leads to a horizontal business relationship.
  10. In traditional trade, due to standardization, there is mass / one-way marketing. However, personalization exists in e-commerce which leads to one-to-one marketing.
  11. Payment for transactions can be made by paying by cash, check or by credit card. On the other hand, payment in e-commerce transactions can be made through online payment methods such as credit card, funds transfer, etc.
  12. Immediate delivery of goods in traditional commerce, but in the case of e-commerce, the goods are delivered to the customer, after some time, usually within a week.

Conclusion

Therefore, with the above discussion, it is quite clear that both methods have their advantages and disadvantages. E-Commerce like traditional commerce, that is when you access the website, you enter the e-world for shopping, in which you choose a category, specifications and obtain the desired results. E-Commerce is not suitable for perishable goods and also for high value items, while traditional commerce is not suitable for the purchase of software or music.