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45+ Common eCommerce Terms

It’s not just big companies that are making money off the Internet these days. There is a whole new breed of entrepreneur who is starting their own eCommerce business, and it can be done with little or no money at all. In this article, I will introduce you to five terms every eCommerce entrepreneur should know if they want to start an online store.

Common eCommerce Terms

Common eCommerce Terms

  • Brick & Mortar – A brick & mortar business, also known as a “bricks and clicks” store, is when a business has both a physical location that customers can visit to purchase products, as well as an online website for people to buy the same products.
  • Brick & Click – A brick & click business is where a company operates in both the real world through traditional retail stores, and also in the online world though eCommerce. The term refers to the physical bricks involved in operating a store front, along with the required clicks of a computer mouse to complete an eCommerce transaction.
  • m-Commerce – M-commerce is when transactions are completed via mobile devices. Examples include purchasing airline tickets with your smartphone, using Apple Pay at checkout, and placing furniture orders on your tablet.
  • Hyperlocal – A hyperlocal store is usually located in a very small area where there are not any other stores selling the same product.
  • B2B – Business-to-business eCommerce is the sale of products between businesses instead of to end-users. For example, a business could sell electric components to another business that then manufactures those parts into something else, like a piece of furniture that you might buy from an online store.
  • B2C – Business-to-consumer eCommerce is when one company sells to individual customers over the Internet. This model is widely used by many different types of companies, including brick & mortar retail stores that are transitioning some or all of their inventory to an online storefront.
  • Omnichannel – Omnichannel refers to using both physical stores eCommerce under one brand name, which allows companies to serve customers in the way they like best. For example, a company may sell its product through an online and physical retail store under one brand name. If a customer finds the product on the website but is interested in seeing it at a brick & mortar store, then that store can direct them back to the eCommerce website purchase page where they will complete the sale.
  • API – API stands for Application Programming Interface, and it is used when two applications (websites) work together so one site can push data to another site without requiring human interaction.
  • Bounce Rate – Bounce rate refers to how many people leave your website after they have landed on a specific web page or viewed a certain piece of content without clicking through to another page.
  • Average Order Value (AOV) – Average order value is the average dollar amount of each purchase made by customers on an eCommerce website. This metric includes the total dollar amount divided by the number of orders made that month or year.
  • Sales Funnel – A sales funnel represents all of the actions that a user takes when they are about to make a purchase, and it maps out how many people visited your eCommerce site, what steps they took to finally buy something, and where people were coming from before they made their final purchase.
  • Smarketing (Sales + Marketing) – Smarketing combines both marketing and sales together in one single strategy which focuses on serving up ads-based customer behavior across shopping platforms like Google, Facebook, and Amazon.
  • Point Of Sales (POS) – A point of sales is a physical location where customers can make a purchase, like when you go to the grocery store checkout counter and by items such as cereal or paper towels.
  • Redirect – When you type one URL in your browser and it automatically takes you to another website, that’s called a redirect because the technology behind the scenes has redirected your browsing behavior from one website to another without any additional input from you.
  • Error – When something goes wrong on a webpage that causes it to crash or display an error message, then that page is experiencing an error. For example, if your username and password do not match what is in the database and online shopping cart system then the website would display an error message.
  • Cache Cache is a temporary storage area for websites where saved data can be accessed more quickly than reading it from the original source every time someone visits the site, which saves time for visitors and generates better results overall. For example, Facebook or Gmail will save your login information so you don’t have to keep entering your username and password over and over again each time you log in to those services.
  • Cookie – A cookie is a tiny text file that is stored by web browsers on computers or mobile devices, which contains small amounts of data specific to that user’s browsing experience on that particular website.
  • Above The Fold – Above the fold refers to the top part of any webpage that shows up without requiring the user to scroll down. This part of the webpage typically includes the main banner image, logos, and navigation menus.
  • Abandoned Cart – An abandoned cart refers to when a customer adds items to their online shopping cart but then leaves your website without intending on completing their purchase or checking out. The amount of products included in the cart is therefore considered an “abandoned” cart because this customer has left and it is unlikely they will return and complete their transaction.
  • Landing page – A landing page is a web page that anyone lands on when they click through from another source like an email marketing campaign, ad, or referral link from another website.
  • SEO – An acronym for search engine optimization, which is the process of optimizing a website or webpage so that it has a better chance of being discovered in search engines like Google.
  • SERP – An acronym for search engine results page, which is what you see when you perform a query in a search engine and get back several pages of links to websites or webpages that match your keyword.
  • Word-of-Mouth Marketing – Word-of-mouth marketing refers to social media sharing on platforms such as Facebook, Pinterest, Instagram, Snapchat, etc., where people share links to products they love with their friends and followers in order to persuade them into making a purchase from that store.
  • Favicon – A favicon is the little icon shown next to the URL in the browser tab or near the URL at the top of the browser. The site owner uploads this file to their website and it shows up whenever someone is on their site, which increases brand recognition.
  • Store Credit – Store credit is an amount of money that you can take off future orders if a customer has spent more than $50 on previous orders with your online store. Customers who have earned enough store credit can use it to lower the price of otherwise expensive products like electronics equipment.
  • SAAS – An acronym for software as a service, which means that customers pay a monthly subscription fee for access to certain features instead of paying upfront for the entire program. This model is also known as “subscription-based.”
  • SLA – An acronym for service level agreement, which is a set of standards that customers agree to before hiring your services or purchasing your products.
  • ROI – An acronym for return on investment, which refers to the amount of money earned from an investment compared to its cost. For example, if you spent $500 opening a store and made $600 in revenue during the first month after launch, then your ROI would be 1:1 because it’s as much as you put into it.
  • CTA – An acronym for call-to-action, which is any action that you want visitors to take on your website such as signing up for a free trial, clicking a link, etc.
  • CRM – An acronym for customer relationship management, which is any software (like Salesforce) that helps you manage your relationships with customers. This is usually done by giving customer service reps easy access to databases containing information of any potential or current customers.
  • CTR – An acronym for click-through rate, which refers to how often people click on a particular link when they see it presented (some number of times/total number). CTRs can be found on Google Analytics data under the “Behavior” section then “Landing Pages.”
  • CAC – An acronym for customer acquisition cost, which means all of the expenses that go into acquiring new customers like acquiring customers directly through ad campaigns vs getting referrals from other customers.
  • CLV – An acronym for lifetime value, which indicates how much money a customer is expected to spend with your business over the course of their entire lifetime.
  • CSV – An acronym for comma-separated values, which means that data is organized in lists and each list item is separated by a comma instead of something like a tab or page break.
  • Two-factor Authentication – Two-factor authentication means that when someone logs into an account from a new computer they have to enter not only their password but also one-time use code sent to them via email or through another service like Google Authenticator.
  • PCI Compliant – PCI compliant refers to any business’s adherence to the Payment Card Industry Data Security Standard (PCI DSS), which outlines regulations for storing, processing, and transmitting card information online. Any merchant not adhering to these rules may be held liable for a data breach.
  • Fulfillment – Fulfillment refers to the process of getting products from your warehouse to customers’ doorsteps. This process is usually done by hiring shipping companies or offering free delivery on select products or orders that meet certain requirements like $100+ in revenue.
  • Inventory – Inventory is the goods that you have available for purchase through your eCommerce store. This can include physical items like clothing and accessories as well as digital content like songs and movies.
  • AB Testing – AB testing is an approach used in marketing, UX design, and other disciplines where ideas are tested against each other before selecting one singular idea (A/B) and discarding the others.
  • Bundling – Bundling is a marketing technique where two or more products are sold as one bundle with a discount price.
  • Churn Rate – Churn rate is any business’s measure of how many customers leave compared to the number of new customers acquired over a specific timeframe.
  • Conversion Rate – Conversion rate is used in web design and conversion optimization to describe what percentage of people viewed a webpage who actually took the intended action (purchase, sign up, etc).
  • Business Blogging – Business blogging refers to writing blog posts for your company’s website rather than for personal use. This often helps companies establish themselves as experts in their field by creating content that uses keywords related to their industry with links back to their site which can improve SEO.
  • Google Analytics – Google analytics refers to a suite of tools provided by Google that help businesses understand how customers interact with their websites, apps, and other digital assets. This includes information like where users come from, what they click on, and how much time they spend on each page or section.
  • Inbound Link – An inbound link is a hyperlink that points to your website coming from another website/domain which improves SEO performance because it shows search engine crawlers that your site is reputable and provides value to internet users . It’s important to note that not all links are good for SEO because some can actually degrade its performance so you should research the source of each backlink before adding them to your site.
  • Cross-Selling – Cross-selling is a marketing technique where products that are complementary to the original product are offered with discounts or listed in the same cart.
  • Up-Selling – Up-selling is a marketing technique where customers are persuaded to buy more expensive versions of the product they’re currently looking at or adding to their cart. Both cross-selling and upselling can be very successful if executed correctly but require testing to see which approach performs best for your store.
  • Dropshipping – Dropshipping is when third-party sellers fulfill orders by shipping products directly to their customers from wholesalers, manufacturers, or distributors instead of having goods shipped to their own warehouse first. This reduces fulfillment costs since they don’t have large inventories which can be challenging to maintain especially if you don’t have a large enough customer base yet.

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