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How Different Is E-Commerce From Traditional Commerce?

Commerce refers to the transaction and exchange of information which is commercial in nature. This includes buying or selling of commodities or services from person to person. This transaction of selling or buying of goods and commodities between two or more individuals takes place in a market.

In traditional commerce the market was restricted to its geographical limits which mean the area where the said activity of buying and selling of commodities takes place. What pushed the envelope for the market place was the introduction of E-Commerce.

A market was not restricted only to the place where a customer came to buy something or the producer came to sell his offerings. E-Commerce not only increased the market space but also added exponentially to the number of customers and sellers at a particular market. 

With the expansion of E-Commerce the number of customers, products and naturally the produce has also increased. E-Commerce has not completely made traditional commerce an obsolete concept but E-Commerce offers a wider spectrum to its users as compared to traditional Commerce.

Traditional Commerce

Traditional Commerce or Commerce is a part of business, which includes all those activities that facilitate or contribute to exchange. Commerce includes two kinds of activities, i.e. trade and auxiliaries to trade. The phrase “trade” refers to the purchasing and selling of products and services for money or in kind, as well as any actions that successfully enable the exchange between parties, including banking, insurance, transportation, insurance, and product advertising. 

In refined terms, commerce encompasses all those activities that simplify the exchange of goods and services, from producer to the final consumer. All the activities that take place from the manufacturing of the product to the eventual consumption by the consumer are included in Commerce. Its main function is to satisfy the wants of consumers by making goods available to them, at the right time and place.


E-Commerce or electronic commerce is the exchange of commodities, funds or information, between businesses and consumers using the internet or online social network. E-Commerce means trading and facilitating trading activities, through the use of the electronic medium, i.e. all the activities like purchasing, selling, ordering and paying are performed over the internet. The scope of E-commerce is discussed in the following points:

  • B2B commerce: when 2 business houses enter a transaction  through the electronic medium it is known as B2B commerce 
  • B2C commerce: when the business and the customer interact directly for the buying and selling of commodities and services through internet it is known as B2C commerce.
  • C2C commerce: when two consumers interact over the internet for the buying and selling of commodities it is known as C2C commerce.
  • Intra-B commerce: When the exchange takes place within a firm through electronic mediums like the internet it is known as Intra-B Commerce 

Comparing Traditional Commerce with E-Commerce

The most prominent difference between Traditional and E-Commerce is the presence of market. The market is present in both cases but traditional commerce relies on a tangible market and interactions between the producer and consumer, E-Commerce does not rely on any such interaction and has an intangible market.

The presence of an intangible market or rather the absence of a market allows E-Commerce to flourish round the clock. There is no specific time wherein the customer has to visit the market and look for the product. The same can be done from anywhere at any time and the producer also can be present at any corner of the world.

In traditional commerce the resource focus is mostly towards the supply side as compared to the demand side of E-Commerce. This basically means that  

In traditional Commerce the requirement of capital is imperative to set up shop. Traditional Commerce requires the producers to invest into establishing a firm base and reputation in the market and maintaining that reputation for their survival in the market. Traditional Commerce demands the attention of the proprietor or the producer to grow and prosper.

The most basic requirement in E-Commerce is the availability of the internet, since all the transactions will take place over the internet. The market in e-Commerce exists on the internet and therefore access to internet is the prerequisite in E-commerce.

Another important requirement for E-Commerce is advertisement. E-Commerce relies on advertisement due to the large market and vivid customers. The product must be unique and should not be something to which the consumer has access to substitutes of. 

Customer Centric Approach

The prerogative of the customer is supreme in Traditional commerce. The customer is supreme in both Traditional and E-Commerce, but they have a greater say in traditional commerce as compared to E-Commerce.

There is transparency between the seller and the costumer because of the physicality of the market. The product may not be standardised but that is for the consumer to decide and they have the option to choose between the best products amongst different products.

The first hand experience of the customer places a sense of trust in them as to the product that they are purchasing is up to their requirement and choice. E-Commerce does not take away the right of the consumers to choose but adds another dimension to it. The ambit of E-Commerce allows the costumers to choose from a wide variety of products which are being offered by an equally large number of sellers.

The consumers get the benefit of a global market. The consumer is ensured the best standards and highest quality of products. E-Commerce also offers a wide variety of sellers that offer products at different prices and the consumer can choose the best price amongst the lot. The consumer has the option of redressal and return of product.

The consumer has the option of instant delivery when it comes to traditional commercial activities. The transaction is instant and quick, whereas in E-Commerce the consumer has to place the order and wait for the delivery date for the delivery of products.

E-commerce and conventional commerce each have advantages and drawbacks to be considered. But given the direction things are heading, there is a significant likelihood that e-commerce now dominates the market and will do so in the future.

Whichever business model is used, E-commerce has taken over the industry and isn’t going anywhere anytime soon. Recent global events have demonstrated that, when necessary, firms are capable of making swift and efficient environmental adjustments. The moment has come for companies to move their commerce online and enter the Internet Age rather than continuing to operate in the Stone Age.

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Aayushi Chopra
Aayushi Chopra
Aayushi Chopra is a law student who is interested in creating content on education, lifestyle, law, health, and environment. She enjoys researching different topics and then expressing her views on them.

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