ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

E-commerce: Exactly What Is It?

Updated on May 2, 2013
Dr Jerry Allison profile image

Dr. Jerry Allison is founder of Kairos Advising and Consulting and has worked with businesses and teaching students business for 30+ years.

A concise definition of e-commerce is developed in this article. This definition agrees with the research definitions presented and provides a more solid basis of measurement for research. The e-commerce definition review examines e-commerce along two different dimensions: an electronic economic transaction and an exchange of value through electronic means. A third dimension, technology, must also be incorporated into the definition since technology underlies all of e-commerce.

E-Commerce Definition Review

When viewing the first dimension of e-commerce as an electronic transaction, one finds the definitions to be similar. The broadest definition is that e-commerce refers to any transaction that is handled electronically1. Though not stated explicitly, these transactions are commercial transactions where economic value is exchanged. This definition is consistent with Lo & Everett2 who suggest that e-commerce consists of any commercial transaction. Both authors imply that commercial transactions involve the transfer of value between two parties. The preceding views coincide with other definitions, namely, electronic exchange transactions3 and electronic exchanges of value4. Implicit in these views is that e-commerce includes electronic transactions that are conducted through some form of automated, electronic network.

A second dimension of the e-commerce definition is an electronic exchange of value. Some definitions only view the transaction as an exchange5 acceptable to all parties involved. While some authors incorporate exchange of value in the definition, others also include the exchange of ownership6. A few speak of the transference of value through electronic means7. Nevertheless, the transfer of value may be an integral part of e-commerce. Transfer of economic value is a broader concept than ownership. Consider a web site that supplies information to the general public. Ownership in the information has not changed hands. However, both parties receive value. The user receives information with utility and the web site owner gets revenue.

The third, and arguably most important, dimension of e-commerce is technology. The creation of computers and the development of sharing data through communication lines are at the heart of e-commerce. While many individuals consider only the Internet when speaking of e-commerce, using e-commerce to conduct business is much more extensive. Firms such as Coles Meyer set up electronic data interchanges (EDIs) for the purpose of replenishing inventory efficiently and quickly8. But beyond material acquisition, this technology allows the timely collection of information previously not possible. A firm employing e-commerce has the capability of collecting microeconomic sales data that could anticipate future purchases. E-commerce encompasses the entire realm of computing that involves transfer of value, transmission of data, and collection of data for the purpose of transacting business.

E-Commerce Definition

This paper makes the following definition for e-commerce: the electronic contracting for the exchange of value through the use of computing and communication technology. This definition not only incorporates the major aspects of the above-mentioned definitions but also is applicable to current studies. The major themes of electronic contracting, the exchange of value, and automation found in other definitions are included. This definition also confines e-commerce to the transaction level and, importantly, is consistent with other literature that provides definitions of e-commerce9.


1Sterrett, C., & Shah, A. (1998). Going global on the information super highway. SAM Advanced Management Journal, 63(1), 43-48

2Lo, W. C., & Everett, A. M. (2001). Thriving in the regulatory environment of e-commerce in China: A Guanxi strategy. SAM Advanced Management Journal, 66(3), 17-26.

3Wood, M. (2001). Prentice Hall's guide to e-commerce and e-business. Upper Saddle River, NJ: Prentice Hall.

4Senn, J. A. (2000). Electronic commerce beyond the "dot com" boom. National Tax Journal, 53(1), 373-380.

5Oelkers, D. B. (2002). E-commerce: Business 2000. Mason, OH: South-Western.

6VanHoose, D. (2003). E-commerce economics. Mason, OH: South-Western.

7Rosen, A. (2000). The e-commerce question and answer book: A survival guide for business managers. New York, NY: AMACOM.

8Johnston, R. B., & Mak, H. C. (2000). An emerging vision of Internet-enabled supply-chain electronic commerce. International Journal of Electronic Commerce, 4(4), 43-59.

9Pillutla, A., & Allison, J. (2002). E-commerce 1.0: Nature of competition and suggestions for effective strategies. Paper presented at the Strategic Management Society, San Francisco, CA.


    0 of 8192 characters used
    Post Comment

    No comments yet.


    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

    Show Details
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
    ClickscoThis is a data management platform studying reader behavior (Privacy Policy)