Is E-Commerce the New Commerce?

As opposed to the notion of general commerce, e-commerce has typically been regarded as a special function in the business world. But over the last twenty years, the traditional views on commerce and e-commerce have changed drastically, and as the business world moves forward into the future, it is clear that the two have merged into one.

Amazon as a paradigm

An example of how businesses have shifted during the digital age is to examine the history of Amazon, for it tells a story about supply chain management evolution in terms of how business to consumer activities operate. 

Dr. Don Warsing, associate professor of operations and supply chain management at the Poole College of Management, says, “Amazon changed the nature of how bookstore sales worked because, at the time, they were an online bookstore, and they took advantage of the idea of having a single warehouse location to deliver all over the country.”

He explains that Amazon could consolidate that demand and fulfill it much more efficiently for any given book than, say, Barnes & Noble could, because the latter had multiple physical locations, which required the retailer to have at least one copy of a particular book everywhere. Amazon, however, did not have to do this and could be more efficient with inventory management. 

The change in customer shopping experience

As opposed to Barnes & Noble, customers who shop on Amazon are not browsing around and enjoying the atmosphere of a store. 

“Customers love the Starbucks coffee shop in Barnes & Noble,” Warsing says. “They love holding the book in their hands, the music on the speakers, and the human assistance of the workers. But then customers see the price tag and realize they can shop cheaper on Amazon. So, even if one physically goes to the bookstore, they end up purchasing it off Amazon for half the price. [The customer] may even go on the company’s website to see if the store has it before making a trip.”

This is where commerce and e-commerce start to intersect. Indeed, people nowadays venture to a physical location to view the product, but, as Warsing noted, a lot of customers end up ordering the product online, which is a massive shift from how businesses operated two decades prior. 

Transactions are different now, too

Warsing offers another insight into how e-commerce has integrated itself into our society, and it starts with an examination of currency. 

“You start to think, well, all business transactions are electronically mediated in some way now,” he says. “All of this stuff morphs together. A lot of people don’t even pay in cash anymore, so there’s an electronic aspect to your transaction, right?”

Indeed, most people today either swipe or insert the chip, and a national coin shortage has only forced more customers to partake in this form of electronic exchange. Further, since the global pandemic began, many people have taken to online shopping as a means of social distancing. 

In turn, changes like these have allowed many customers to reconsider the purchase process, such as the human labor that goes into these transactions. For example, as customers go to the grocery store in 2021, they might see goods on the shelf and think more about the fact that someone had to stock those products, in turn creating a greater sense of empathy for workers.

Overall, the shift in consumer behaviors and business operations in recent years is causing the line between e-commerce and traditional commerce to blur, leaving us with the question, “Should we re-evaluate how we define, teach and approach the concept of commerce altogether?” 

“20 years ago, people were talking about e-commerce as something different, and it’s really not,” Warsing says. “Now it’s just a different way of getting access to the materials you need as an individual and, by and large businesses, too. Internet-based transactions are now the norm.”

This post was originally published in Supply Chain Resource Cooperative.