The Authoritative eCommerce Terms Glossary

Insight

At long last, there is a truly authoritative eCommerce terms resource. This was a collaborative effort from the Daasity team and from a number of partners in the eCommerce ecosystem. A big thank you to those who participated and helped us build this list!

How to Use This Page

We’ve broken this list into two general categories: Data Processes as well as Commerce/Website (commerce includes eCommerce, Amazon, and retail/wholesale). 

  • Any term that is bolded has its own entry/listing. 

If you would like to look up a term, search this document using your command + f function (if on a Mac) or control + f (if on a PC). 

If you have a term that you think should be added to this list, please contact davids@daasity.com

Data Processes:

  • Data pipeline: The steps required to bring data from particular sources to a desired location. ELT and ETL are two types of data pipelines (see below).
  • ELT (Extract, Load, Transform): The modern process of pulling data from disparate sources into a data repository (such as a data warehouse) and mapping it into a schema for analytics, visualization, and/or other uses.
  • ETL (Extract, Transform, Load): The process of pulling data from disparate sources into a staging environment, transforming data into schemas within that environment, and load
  • Reverse ETL: The process of copying data from a data warehouse to another platform (usually a SaaS tool) in order to leverage that data
  • UMS: Unified Marketing Schema (a generic schema for marketing performance and spend)
  • UNS: Unified Notifications Schema (a generic schema for email, SMS and notifications)
  • UOS: Unified Order Schema (a generic schema for commerce platforms)

Commerce/Website:

  • 301 redirect: A way to let search engines and site visitors know that a webpage moved to a new address. Customers who bookmarked your old webpage will be redirected to the new one. Many website hosts, such as Webflow, have functionality that allows for quick 301 changes, by typing in the old URL as well as the new one.
  • 3PL (third-party logistics): “Third-party logistics (or 3PL) refers to the outsourcing of eCommerce logistics processes to a third party business, including inventory management, warehousing, and fulfillment. 3PL providers allow eCommerce merchants to accomplish more, with the tools and infrastructure to automate retail order fulfillment.”

A

  • A/B testing (or split testing): A process that lets you compare two versions of a webpage so that you can determine the more effective one. Typically, an A/B test involves showing Version A and Version B to groups of would-be customers during the same timeframe to learn which approach nets the higher conversion rate.
  • Abandonment: When a site visitor has left your site without converting (see Conversion). In the situation where the potential customer has added items to their cart but ends up leaving, they have “abandoned” their cart (see cart abandonment rate).
  • Accounts Payable: Any amount your business owes to outside vendors, creditors, investors, or customers. [From Ampla]
  • Accounts Receivable: Refers to a balance of money that is owed to a business for goods or services that have already been delivered but have not been paid for by customers. [From Ampla]
  • Address verification service (AVS): A service that credit card processors implement to verify that the billing addresses of your customers match the addresses on their credit card statements
  • Affiliate marketing: A marketing strategy in which your eCommerce business partners with online publishers so that they will promote and endorse your products and send customers to your website. Typically, the affiliate receives a fee for every website visitor or sale generated from the promotion. 
  • Affiliate marketing network (AFN): “A service that connects publishers (i.e., affiliate marketers) with brands. The network acts as the “middleman” so that both publishers and brands offering programs can find each other easily. Brands can find and contract affiliates fast to promote their products and open up a new sales channel.”
  • Amazon Fulfillment Network (AFN): Amazon's vast supply chain that includes distribution/fulfillment centers, storage facilities (including cold storage), Prime Now hubs, delivery stations for smaller packages, delivery stations for large packages, returns centers, airport hubs, and home delivery logistics
  • Alt tag: An HTML attribute that provides information about an image if the user cannot view it due to page load errors, or due to visual impairment. For example, an image that shows someone wearing a backpack might have alt text such as “man wearing backpack while riding a bike in the mountains.”
  • Annual Percentage Rate (APR): An Annual Percentage Rate is the cost that one will pay over the course of 12 months in exchange for borrowing money. APRs are typically expressed as a percent (%). [From Ampla]
  • Anchor text: The clickable text that links to another location (a page, document) on the Internet.
  • Annualized cost of capital: The level of return you have to exceed within the next year to make it “worth it” (i.e. profitable) for you to borrow money from someone.
  • Application Programming Interface (API): “API is the acronym for Application Programming Interface, which is a software intermediary that allows two applications to talk to each other. Over the years, what an ‘API’ is has often described any sort of generic connectivity interface to an application.”
  • Amazon Standard Identification Number (ASIN): The 10-character alphanumeric codes that Amazon uses to ID products. Effectively, ASINs are Amazon’s version of the SKU.
  • Assets: Anything owned by a business that creates monetary value in one form or another, either in the present or future. [From Ampla]
  • Assisted conversions: This Google Analytics report summarizes and ranks the importance of marketing channels in a consumer’s conversion journey. It helps you identify the channels responsible for generating leads and visits to your website so you can nurture would-be customers and convert them. 
  • Automation: With no-code eCommerce automation tools, non-technical people in eCommerce are empowered to streamline their day-to-day business processes by running automated workflows in real-time. These can be tasks like fulfilling orders, updating quickbooks accounting software, running loyalty programs, and more. [From Alloy]
  • AUR (Average Unit Retail): The average selling price of an item
  • Authorization: The process when your customer’s credit card issuer gives permission and allows a payment transaction to proceed 
  • Autoresponder: A tool or program that automatically emails or messages an individual after an action is taken. This can be after the person emails customer service, signs up for an email list, or any other (usually) common action that warrants an immediate reply.
  • Average days in transit: The typical time it takes for products to ship from your fulfillment center to the customer
  • Average order value (AOV): This is the average amount that a customer spends when visiting your digital storefront.
  • Average revenue per customer (ARPC): The amount of top-line revenue that one customer contributes to your eCommerce brand over a time period (it is usually measured and tracked monthly, quarterly, and yearly)
  • Average time on site: The typical amount of time your visitor spends on your website within a specified time frame

B

  • Back end: The data access layer, server-side portion of a website. Built using languages such as Python, PHP, and Ruby
  • Backlink: These are links from a website that link to your website. Backlinks are important in SEO, as they show Google trustworthiness of a particular page or resource.
  • Backorder: An item that is temporarily out of stock but is expected to be delivered within a certain time frame once it’s back in stock.
  • Backorder rate: The percentage of products that cannot be immediately fulfilled due to insufficient stock
  • Billing address: The address used on a customer’s credit card statement. 
  • Black Friday: Black Friday is the day after Thanksgiving (US), and is considered the beginning of the end-of-year holiday shopping season. Typically, there are large sales on Black Friday that compel customers to purchase. Black Friday can also be lumped together with Cyber Monday in the acronym BFCM.
  • Black hat: In the context of SEO, “black hat” strategies are unapproved (or directly banned) by search engines and the SEO community intended to improve search rank. In the early days of search engines and SEO, now-considered black hat techniques, such as keyword stuffing, were rampant, which led to low-quality results appearing at the top of an SERP. Now, black hat strategies tend to exclusively hurt pages, given search engines’ advanced algorithms. 
  • Bounce rate: The percentage of visits to a website where visitors leave after viewing a single page
  • Google BigQuery (BQ): Google’s serverless multi-cloud data warehouse, and part of the Google Cloud Platform (GCP). BigQuery has certain unique characteristics, such as requiring substantially different SQL syntax when querying data. 
  • Brand board: A document that summarizes and displays elements of style/other visuals (e.g., color scheme, logo, etc.)
  • Bundling (or product bundling): The grouping of related products or services as a package or solution, often offered at a reduced price, to encourage conversion. 
  • Business to business (B2B): Online transactions in which an online business sells products or services to other businesses
  • Business to consumer (B2C): Online transactions between a merchant and a consumer
  • Buy now, pay later (BNPL): A financing option that lets customers purchase products by placing a down payment and paying the remainder later in installments. Installments are typically 4 payments due every other 2 weeks with the first payment being due on the date of purchase. 
  • Buy-to-detail rate: A Google Analytics metric that looks at the number of products purchased relative to the number of times the customer viewed product detail pages. Here’s the calculation: Unique Purchases of a Product/Product Detail Page Views = Buy-to-Detail Rate 
  • Buyer Persona: “A buyer persona is a semi-fictional representation of your ideal customer based on market research and real data about your existing customers. When creating your buyer persona(s), consider including customer demographics, behavior patterns, motivations, and goals. The more detailed you are, the better.” 

C

  • Call to action (CTA): An advertising and marketing tactic that involves providing instruction to the target audience to persuade them to take an action, such as “visit now,” “learn more now,” “subscribe now,” and “get access now.”
  • Cart abandonment rate: An online shopping metric that shows the rate of potential customers who leave a site before completing their purchases compared to all the shopping carts created.
  • Cart-to-detail rate: A Google Analytics metric that looks at products added to a customer’s cart relative to views of product detail pages. Here’s the calculation:
    Times a Product Is Added to Cart/Product Detail Page Views = Cart-to-Detail Rate
  • Carrying cost (aka carrying cost of inventory or holding costs): The sum of all expenses related to storing products in your warehouse until they sell. The expenses include insurance, taxes, labor, energy, product depreciation, and inventory storage costs (i.e., rent of building or warehouse space).
  • Cascading Style Sheets (CSS): A language that allows for basic design on web pages built in HTML. Along with HTML and JavaScript, it is one of the core code building blocks of websites.
  • Chargeback: A reversal of a completed credit card transaction—typically because a customer disputes a charge and the merchant’s bank refunds the value of the transaction
  • Chatbot: A program/tool that a website visitor/customer can communicate with, often to answer basic questions. Chatbots are often used to help CS/CX teams by responding to common questions that can be answered simply.
  • Churn Rate: The percentage of customers who stop purchasing after a given timeframe. Churn rate is usually discussed in the context of subscription customers: when a subscriber ends their subscription, they have “churned.” However, this may also apply to transactional customers who have not purchased for a designated period of time, such as a year. To “reactivate” them as customers and prevent churn, you may send them a Winback Campaign.
  • Click-to-open rate (CTOR): This measure reflects the effectiveness of the message and content in your email in getting recipients to click through and find out more about your business or offer. To calculate: Unique Clicks/Unique Opens x 100 = Click-to-Open Rate 
  • Clickthrough rate (CTR): The percentage of viewers and/or users who click an ad/prompt/CTA
  • Cohort analysis: An analysis of customer behaviors, during a specified timeframe, of a subset of your ecommerce customers that have been segmented from all your visitors based on shared characteristics
  • Comma separated values (CSV): A text file that uses commas to separate each value. CSVs are the most common way to import/export data into/from a database.
  • Content Delivery Network (CDN): “A content delivery network (CDN) refers to a geographically distributed group of servers which work together to provide fast delivery of Internet content.”
  • Content optimization system (COS): The collection of strategies and procedures associated with improving content (either past or planned). 
  • Contribution margin: Top-line sales minus discounts, refunds, returns, cost of goods sold, and marketing costs. In short, contribution margin is the difference between your gross margin and marketing budget.
  • Conversion: A conversion can be defined in multiple ways, depending on the marketing goal. For example, a conversion may be a potential customer subscribing to an email list, or it may be an online store visitor making a purchase.
  • Conversion funnel: A way to detail and track the events that your customers follow to conversion. It’s called a funnel because a percentage of visitors leave your website at each event along the journey; at conversion, there are fewer potential customers than there were at the start.
  • Conversion path: The series of steps that website visitors take before they become a lead. This may begin with a landing page, PDP, or another advertised page, follow with other on-site browsing, and conclude with a purchase.
  • Conversion rate: A measure that looks at the percentage of online store visitors who become paying customers or complete another designated goal
  • Conversion rate optimization (CRO): The process of enhancing the user experience of a website to improve the chances of convincing the visitors to complete their online goal. This may involve tweaking the web layout (UI), content, and design as a whole so that the goal for hiking the conversion rate is achieved. The process involves clear understanding of web design basics, human psychology, and statistics.
  • Cookies: Small text files a website sends to a visitor’s browser to store data related to that visitor’s interactions with the website. These text files are sent back to the server each time the visitor accesses the website. Cookies are mainly used for ad and content targeting, and for saving shopping cart information. 
  • Content Management System (CMS): A back end tool used to launch, revise, and otherwise maintain the content on the front end of a website. Rather than requiring a developer to launch new blogs, for example, a writer can simply input different elements of an article in designated slots (“Title,” “Author,” “Hero Asset,” “Article Text,” etc.). CMS are fundamental to successful Enterprise Content Management (ECM) and Web Content Management (WCM). 
  • Cost of goods sold (COGS): The direct costs incurred by a company while manufacturing and selling its products. For Daasity’s 2-part COGS formula, follow the link. 
  • Cost per acquisition (CPA): The average marketing spend to gain one new customer, specifically, spend on ad vendors (e.g., what was spent on Google Ads in a particular week). 
  • Cost Per Click (CPC): The cost that an ad vendor charges on a particular keyword/search query, on a per-click basis. These may vary wildly, depending on the vendor and the competitiveness of the keyword. 
  • Cost per order (CPO): The average marketing spend needed to drive any purchase to your store
  • Creditor: An entity that gives another entity permission to borrow money from them to be repaid in the future. [From Ampla]
  • Cross-selling: When a brand offers additional products that complement, enhance, or relate to a product being sold (“Would you like a tie with the suit you’re purchasing?”). 
  • Customer acquisition cost (CAC): Customer acquisition cost is a metric that factors in the total cost of acquiring a customer. This includes variable marketing cost (i.e., the spend on ad vendors), recurring costs of eCommerce/marketing tools used for acquisition, cost to create ad creatives, team salary, and agency costs (if applicable). (Compare to Cost per acquisition).
  • Customer experience (CX): How a business engages with its customers at every point of their buying journey and how it gains a deep understanding of each type of customer to create memorable and positive shopping experiences
  • Customer lifetime value (CLV, LTV, CLTV, Lifetime Value): Customer lifetime value is simply gross margin per customer over their lifetime with your brand. LTV is calculated by subtracting landed cost from gross revenue. It is commonly mixed up with other metrics, such as total sales or predicted sales value. (Also see LTV:CAC ratio
  • Customer Record: A line of information of a single customer.
  • Customer Relationship Management (CRM): CRM refers to a practice that helps an organization to manage and analyze customer’s interactions throughout the customer lifecycle to improve customer relationship in order to achieve its business goal. This system integrates the back and front office systems to organize and document customer contacts, purchases, customer service and technical support provided in the process. It compiles information of customers across different channels like company’s website, telephone, live chat, direct mail, marketing materials and social media. CRM serves to enhance the customer’s overall experience by providing enhanced customer service and products.
  • Customer Segment: A list of targeted customers, with a particular common attribute (customer profile, purchasing behavior or demographics) retrieved from the data source by a custom query.
  • Cyber Monday: The Monday after Black Friday. Historically, this day has more deals and discounts than any other day of the year. Some claim in the last few years that Cyber Monday has exceeded Black Friday in overall sales.

  • Debt Financing: An umbrella term for ways to fund your business by borrowing money and agreeing to pay it back (with interest) at fixed payment terms
  • Demographics: Demographics are data around the population, broken down in any way that is statistically useful. 
  • Disclosure statement: “A disclosure statement is a financial document given to a participant in a transaction explaining key information in plain language.”
  • Discount code (coupon, or promo code): A phrase, word, or alphanumeric code that a customer can activate upon checkout in order to receive a percent or dollar-amount off their order. (“Enter code ‘SUMMER20’ to get 20% off your next order placed between June 1 and June 30”)
  • Discount rate: The fee that an online merchant pays to its third-party payment processor for processing credit card payments—typically a small percentage of each payment processed
  • Dofollow link: Links from one site that search engines follow to another website, expressed in an HTML tag. From the perspective of the site that receives a link (i.e., the site that has been linked to), this is a backlink. (Also see no-follow link)
  • Domain: The main page or main URL for a website. This is often the "homepage" or root portion of the web address.
  • Drip marketing: “Sending a limited number of emails to your audience automatically, on a set timing, based on actions they take or changes in their status. Businesses use drip marketing to keep in touch with an audience—in a personalized and targeted way—following important actions or dates.”
  • Dropshipping: When an online store works with wholesale suppliers for the delivery of products by passing them shipping information about each customer order

  • eCommerce platform: An eCommerce platform is the software that a brand uses to build their B2B and/or B2C (i.e., DTC) business. Examples of eCommerce platforms are Shopify, BigCommerce, and Adobe Commerce.
  • Email flow (or email sequence): An automated series of emails that are sent to a user or group of users. These are usually “triggered” by certain events, such as a purchase, engagement with a website, or a product that a customer left in a cart.
  • Email marketing: Promotion of your products and services to a targeted audience through email
  • Engagement rate: A measure of social media performance (in terms of how much an audience interacts with your brand). Can be calculated in a variety of ways, including: (positive interactions in a timeframe  / followers) x 100
  • Enterprise Content Management (ECM): “Enterprise content management (ECM) — sometimes referred to as document management or records management — is the process of managing the entire lifecycle of an organization’s content, including documents, spreadsheets, contracts and scanned images.”
  • Event-triggered email: Email sent to subscribers based on specific events, such as a special offer tied to a subscriber’s birthday or wedding anniversary
  • Evergreen content: Refers to blog articles, social media posts, etc. that are not (or considerably less) seasonal or otherwise time-dependent. For example, an article called “10 BFCM 2023 Marketing Tips” is not evergreen, while an article about the fundamentals of HTML is evergreen. 

  • First-party data: Information collected from your customer base, subscribers, and site visitors when they interact with your site or marketing, or when they make a purchase 
  • Front end: The user-facing and interactive portion (“presentation layer”) of a website, built using languages including HTML, CSS, and JavaScript. (Compare to back end)
  • Fulfillment: The receipt, processing, packaging, and shipping of orders made through your online store 

G 

  • GA4 (Google Analytics 4): the latest Google Analytics platform, replacing GA3 (Universal Analytics) on July 1, 2023. 
  • Gateway (or payment gateway): An ecommerce service provider that communicates with your merchant account provider to authorize and process credit card payments. 
  • GCP (Google Cloud Platform): Google’s suite of cloud-based services, including Kubernetes, Looker, BigQuery, Compute Engine, and more.
  • Google Ads: An advertising service that allows business to set a budget and then runs the promotions that you have written. Ads are typically composed of SEO keywords. 
  • Google Analytics: A free website analytics service that tracks and reports website traffic into graphs and charts for easy access to traffic trends over designated periods of time. 
  • Google Keywords: Trending words or phrases based on what users are searching for within Google. Keywords are often tracked and used throughout ads and other marketing tactics. Matching keywords from a search are displayed on the Search Engine Results Page (SERP).
  • Growth hacking: A marketing approach that blends analytics, traditional marketing, and product engineering to sell products, advertise services, and gain exposure rapidly
  • Gross margin: Net sales - product costs (COGS)
  • Gross merchandise value (GMV): Used to determine the total value of your sales over a given period. GMV is a good indicator of your eCommerce store's growth because it measures your sales volume and value—revealing how well your store is performing over time. 

  • Heatmap: “Representation of data where values are depicted by color.” Often used to identify higher and lower engagement areas of a web page.
  • HTML (Hypertext Markup Language): Also commonly referred to as "the code" of a website, HTML is a language that structures a web page or application. HTML can adjust syntax, font, layout, images or links throughout the page. HTML can also be manipulated by the user to manipulate the page function to behave a specific way or to change the overall look. 

  • Inbound Marketing: A marketing strategy built around offering value to potential customers that compels them to engage with you. A classic example of successful inbound marketing is by offering great blog content. This may show expertise or authority on a particular topic or topic category, which brings readers in, and some of those readers may be interested in purchasing your product or service. (Compare to Outbound Marketing)
  • Infographic: Visual assets that combine text (“information”) and images (“graphic”) to educate the viewer about a particular concept or topic. 
  • Inventory: A retailer’s products on hand in a warehouse, waiting to be sold 
  • Inventory to sales ratio (I/S ratio): Represents your inventory as a percentage of total sales. It indicates how much of your inventory converts to sales. 
  • Inventory turnover: Shows how many times you sell through and replace your inventory over a period of time. It represents the conversion of inventory to sales

J  

  • JavaScript (JS): A lightweight, just-in-time (JIT) script language that makes web pages interactive, allows for graphics, animations, content updates, and much more. JavaScript is considered the third building block of websites along with HTML and CSS.

K 

  • Key Performance Indicator (KPI): “The critical (key) indicators of progress toward an intended result. KPIs provide a focus for strategic and operational improvement, create an analytical basis for decision making and help focus attention on what matters most.” (See also Leading Indicator and Lagging Indicator)
  • Keyword density: The frequency of a term(s) on a particular page. A keyword density that is too high may indicate keyword stuffing. From an SEO standpoint, there is no “ideal” frequency of a term on a particular page, but there is some correlation between longer articles and more of the same keyword. For example, a 300 word article might be flagged for keyword stuffing if a particular keyword appears 20 times, while on a 2000 word article, 20 appearances would be fine. 
  • Keyword ranking: Where your site ranks with a certain keyword on a search engine results page
  • Keyword stuffing: An SEO strategy that overloads a webpage with as many keywords as possible, often without context, to manipulate a site’s search engine ranking. Considered a black hat strategy, keyword stuffing is almost always ineffective and will lead to lower search results.

L 

  • Lagging indicator: A KPI based on something that has occurred, e.g., net profit. Lagging indicators allow brands to analyze past performance and understand what was done effectively vs ineffectively as well as what could be proved upon. 
  • Landed cost: Refers to all expenses involved in getting a product from the retailer to the customer. This includes suppliers, warehousing, taxes, and insurance
  • Landing page:  A single webpage on a site where a visitor arrives after clicking a link, often from the homepage. Such pages can exist to prompt a visitor to complete a call to action, such as signing up as an email subscriber or becoming a member of a special customer group. 
  • Lead: A prospective customer who has shown some kind of interest in a product or service
  • Lead magnet: Something that is given away for free in exchange for contact information. For example, “Sign up for SMS and get 10% off your first purchase.” Or “Sign up for our email list and get our 100pg ebook on cat nutrition.”
  • Leading indicator: A KPI that predicts or signals something to come. Leading indicators allow brands to understand more about what’s to come. For example, number of subscribers to an email list and number of customers with an active subscription for a product/service are two leading indicators.
  • Liabilities: Any type of financial obligation that a business must pay to an outside individual, group, business, or government at the end of an accounting period [From Ampla]
  • Line of credit: a type of revolving credit account that allows you to borrow money when you need it up to a borrowing limit. This bank account operates similarly to a credit card, with a few key differences.
  • Listing fee: A fee that some online auction websites charge sellers to list products or services. 
  • Logistics: The umbrella term for getting an order to a customer. This includes packing, shipping, and fulfillment. 
  • Long-tail keyword: In the context of SEO, these are keywords that are longer and more specific queries than short-tail keywords. While a short-tail keyword might be “jeans,” a long-tail keyword might be “how to fix holes in jeans.”
  • LTV:CAC Ratio (also CLV:CAC): the ratio of your brand's customer lifetime value (i.e, average gross margin per customer over their lifetime with your brand) and your customer acquisition cost (i.e., how much your business spends, on average, to acquire a new customer). For example, a 3:1 LTV:CAC ratio indicates that a brand can expect to make 3x what it spent to acquire a customer. Tracking LTV:CAC is crucial for eCommerce brands in order to understand how effective marketing efforts are as well as long-term profitability.

  • Margin (aka profit margin): A measure of the difference between what a retailer pays for or spends to create a product and how much it earns on each sale of the product 
  • MER (marketing efficiency ratio): Measures the overall performance of your marketing campaigns: total revenue divided by total spend. It is also known as marketing efficiency rating, blended ROAS, or ecosystem ROAS.
  • Merchant account provider:  An online account service provider that lets ecommerce businesses accept debit and credit payments, and temporarily holds the money until it’s transferred to the business’s bank account 
  • Mobile commerce (m-commerce): The use of wireless electronic mobile devices such as cellphones, smartphones, and tablets to buy and sell products and services online
  • Monthly recurring revenue (MRR): The total revenue generated by subscriptions to products or services in a given month
  • Multi-Touch Attribution: Modeling and analysis that help determine which marketing channels along the customer journey get credit for a sale. Here are a number of attribution models:
  1. Last interaction model: The last channel that the customer interacted with before buying receives 100% of the credit for the conversion. 
  2. Last non direct click model:  All direct traffic is ignored in this model, which credits 100% of the conversion to whatever interaction the customer had before making a purchase. 
  3. Last AdWords click model: The last AdWords ad that the customer interacted with before buying receives 100% of the credit for the conversion. 
  4. First interaction model: The first channel that the customer interacted with before buying receives 100% of the credit for the conversion. 
  5. Linear model: Every channel that the customer interacted with before converting receives an equal share of the conversion credit. 
  6. Time decay model: This one gives most of the credit to the channels the customer interacted with in the time nearest to the sale. 
  7. Position-based model: This model attributes 40% of the conversion credit to the first interaction, 40% to the last interaction, and the remaining 20% equally across any interactions that occurred between the first and last interactions.

N

  • Negative keyword: On advertising platforms (or on Amazon), negative keywords tell the vendor not to show your ads for particular terms.
  • Net promoter score® (NPS®): “Measures customer experience and predicts business growth.” Customers are asked one question (“How likely is it that you would recommend [brand] to a friend or colleague?”) to address on a 0-10 scale. They are measured on a three-tier scale of Promoters, Passives, and Detractors
  • Nofollow link: A nofollow tag tells a search engine not to follow a particular link. These are the opposite of dofollow links, which tell search engines to follow a link to its destination. Nofollow links have no impact on search rank, while dofollow links do.
  • North star metric: A “most important” metric that a brand seeks to improve in order to grow. A classic example of a north star metric is customer lifetime value

  • Open rate: The number of email subscribers who open the email you sent them. Open rate has been dramatically (and negatively) affected by iOS 15. At present, open rate is considered to be a somewhat to largely ineffective metric to rely on when evaluating email performance.
  • Organic (Traffic) :The way users find a website through a search engine query. The results populate based on relevance to the search query. Google/other search engines arrange results based on page rankings, so higher-ranked pages appear closer to the top. Users that have found sites this way are said to have found it "organically." 
  • Outbound Marketing: A marketing strategy built around interaction that is initiated on the business side rather than the customer side. Classic examples of outbound marketing are cold calls or tailored emails that are built to engage individuals who otherwise have not engaged with a brand. (Compare to Inbound Marketing)
  • Outsource: The use of third-party vendors to support business needs to reduce overhead costs 
  • Out of Stock Rate (OOS rate): Tracks the number of lost sales due to insufficient inventory. A low out of stock rate—below 10%—is ideal to keep customers happy and reduce the number of lost sales. For this metric, the lower it is, the better.
  • Omnichannel marketing: A strategy that integrates multiple marketing channels in a seamless experience for your audience that adapts to their needs as they move through the customer journey (aka your marketing and sales funnels). It creates a consistent experience across the board of branding, messaging, and sales offers, regardless of where a customer may be in their journey, whether they are online or offline, or which platform they are on.
  • Order tags: Identifiers your eCommerce platform or third-party tools attach to each order. These tags help you filter your historical orders to discover trends and actionable insights. [From Candid Leap]

P 

  • Page Rank (PR): Measures where a page is ranking with Google or another search engine. Higher ranked pages are closer to the number one spot.
  • Paid social media: Displays sponsored content or messaging on social media platforms to targeted audiences
  • Partial shipment: When you send only part of an order to a customer and fulfill the order in multiple deliveries
  • Path length: A Google Analytics metric that summarizes how long, in interactions, it takes visitors to your ecommerce site to become customers 
  • Payment Card Industry (PCI) compliance: A set of requirements to ensure you protect your customers’ credit card information when stored, processed, or transmitted 
  • Payment service provider: An eCommerce service that lets online stores accept and process multiple payment methods, such as credit cards, direct debits, bank transfers, and real-time online banking
  • Pay-per-click (PPC) marketing: An advertising model in which the business pays only when someone clicks an ad and is directed to the retail website
  • Personalization Maturity Model: Personalization is a means of meeting customer needs more effectively and efficiently through increasingly relevant, uniquely tailored experiences—across the customer journey—at scale. 
  • Point-of-sale (POS) system: Software that lets an online store accept transactions, manage inventory, add products, process payments, and send receipts digitally
  • Post-purchase surveys: Poll/questions posted to a buyer after a transaction. Merchants employ post purchase surveys to ask questions like "Where did you hear about us?" to track and quantify order attribution and understand their customer base. With post-purchase surveys, there is little risk of over or underreporting attribution to a specific channel. Merchants also use post purchase surveys to collect other information from their customers to build a more personalized email and SMS experience. [From Candid Leap]
  • Priority SKU: A product you’ve identified as one that’s important to keep in stock–perhaps it’s your hero product or most profitable item. You can have more than one priority SKU and rank them A, B, C, etc.
  • Product Detail Page (PDP): A PDP allows merchants to sell a product to a customer. Typically, a PDP includes product title, description, images, price, and a call-to-action.

Q

  • QR Code: A type of matrix barcode with a machine-readable optical label that can share information or trigger an action when scanned. [From Alloy Automation]

R 

  • Recurring payment: A transaction wherein a customer authorizes an online store to automatically charge a credit card for regular delivery of products or services
  • Repurchase rate: The percentage of customers who have purchased more than once in a time period
  • RFM Analysis: RFM analysis allows eCommerce brands to segment and rank their customers by value over a time period, using three dimensions: Recency (how recently someone purchased), Frequency (how frequently someone purchased), and Monetary (how much they spent). In short, RFM analysis shows who your best and worst customers are​​—and everyone in between. 
  • ROAS (Return on Ad Spend): A marketing efficiency metric that shows how much money you generate for every marketing dollar that you spend

S 

  • Search engine marketing (SEM): Collection of strategies around paid advertising in order to build brand awareness and drive revenue on search engines, such as Google and Bing. Although SEO/organic marketing used to fall into the SEM category, it now almost always refers to paid media work. 
  • Search engine optimization (SEO): The set of strategies associated with increasing traffic (and, ideally, quality of traffic) to a website, via higher ranking in search engines 
  • Search Engine Results Page (SERP): The page that lists all the results from a search query within a search engine. Search engines list relevant terms by analyzing the query and the site to provide the best matches. 
  • Secure sockets layer (SSL): “A security protocol that provides privacy, authentication, and integrity to Internet communications. SSL eventually evolved into Transport Layer Security (TLS).”
  • Sell-through rate: Tracks how much of a product is sold compared to the unsold inventory of that product over a time period. Ideally your products will have a high sell-through rate (at least 80%).
  • Server-side tracking: A process where your store sends user events and visitor behaviors from your owned servers to destinations such as marketing platforms, analytics solutions, and databases. Previously, most eCommerce stores would fire and send this data from the web browser (known as client-side tracking). Due to changes in the digital landscape (e.g. browser settings), server-side tracking has become an increasingly popular way to implement marketing tracking pixels (e.g. the Meta Conversion API) and analytics. [From Candid Leap]
  • Shipping: The transfer of a product from a seller’s warehouse to a customer’s delivery address
  • Shopping Cart: An eCommerce shopping cart is the contents of what a user has added to their online order. All the products appear as a mass order on the page, or in this case, "in the cart." 
  • Short message service (SMS) marketing: SMS marketing refers to a direct messaging platform for businesses to send customers campaigns via text message.
  • Short-tail keyword: In the context of SEO, a short, broad search term, such as “jeans.” Compare to long-tail keywords (see relevant definition), which is a longer, more specific search term, such as “how to repair holes in jeans.”
  • Slug: The section of a URL that describes page content. E.g., in this page’s URL, https://daasity.com/post/ecommerce-terms, the slug is “ecommerce-terms.”
  • Social media marketing (SMM): Marketing practices that focus on building brand awareness, engagement, and driving revenue via social media (e.g., TikTok, Pinterest, Facebook, Instagram, Twitter). 
  • Social signals: “Social signals refer to a webpage's collective shares, likes and overall social media visibility as perceived by search engines. These activities contribute to a page's organic search ranking and are seen as another form of citation, similar to backlinks.”
  • SQL (structured query language): Programming language used to manage relational databases (e.g., Snowflake, MySQL, Azure)
  • Stock keeping unit (SKU): A unique alphanumeric identification code for each product or service in your business’s inventory. (See ASIN for Amazon’s version)

T 

  • Time lag: A Google Analytics measure that summarizes how long, in days, it takes your website visitors to become customers 
  • Third-party data: Information you purchase from data aggregators, advertisers, or gain by running tracking ads with companies like Facebook and Instagram 
  • Third-party payment processor: An external service that helps merchants accept and process online payments even without a merchant account, such as PayPal 
  • Time between orders: A metric that shows the duration between a customer's orders, and in effect, how long it will likely take customers to place their next order
  • Transaction: A record of the actions taken for each order 
  • Turnkey: A software product sold as complete and ready to operate 

U 

  • Uniform resource locator (URL): The address of a page, item, or resource on the Web. For the readable portion of a URL, see Slug.
  • Units per transaction (UPT): The average number of items purchased per order
  • Upselling: A technique to offer customers an opportunity to upgrade a purchase or to buy a more expensive version of a product to maximize the value of the purchase for the seller. (“Would you like to buy a 5-pack instead of a 3-pack for only $0.59 extra?”)
  • Urchin Tracking Module (UTM): The format used by Google to track your unique URLs 
  • User Experience (UX): A fundamental principle of web design that “Focuses on having a deep understanding of users, what they need, what they value, their abilities, and also their limitations. It also takes into account the business goals and objectives of the group managing the project. UX best practices promote improving the quality of the user’s interaction with and perceptions of your product and any related services.”
  • User Interface (UI): In the context of website design, UI is what is displayed to a user on the front end. Factors to consider in UI design are color, font, images, animations, interactivity, and more. 

V 

  • Void: A transaction that cancels a purchase that has not been completed

W 

  • Web analytics: A set of strategic methodologies to collect, measure, analyze, and report website data to understand the behavior of visitors and customers so you can optimize the site experience and improve conversion. 
  • Web Content Management (WCM): “The process of controlling content consumed over one or more digital channels through the use of specific management solutions based on a core repository. These solutions may be procured as commercial products, open-source tools, cloud services or hosted services.”
  • Weeks of supply (WoS): An estimate of how many weeks the inventory of a product will last based on your current sales rate. A healthy WoS is often around 6 weeks, but this depends on your brand and products.
  • White hat: In the context of SEO, “white hat” strategies refer to best practices as well as strategies condoned by search engines to improve search rank. White hat is often contrasted with black hat.
  • Winback campaign: A winback campaign is a series of messages (emails or SMS) that is designed to prevent a customer from churning. For example, if a customer has not purchased from your brand in nearly a year, you may send them steep discounts in order to repurchase. 
  • Wholesale: The distributor or manufacturer, or the party that sells directly to retailers
  • Webhook:  A webhook is a lightweight API that powers one-way data sharing triggered by events. Webooks enable outside applications to communicate with specific tools—if they aren't natively supported as an integration already.
  • Working Capital: Working capital is the amount of leftover money a business has over once it subtracts its current liabilities from its existing assets.

X

  • XML: "A simple text-based format for representing structured information: documents, data, configuration, books, transactions, invoices, and much more. It was derived from an older standard format called SGML (ISO 8879), in order to be more suitable for Web use."

Z

  • Zero-party data: Information from customers that they voluntarily and deliberately share with you. You acquire it through quizzes/polls, website activity, and customer profiles. You can then use this data to build personalized and specific product suggestions, interactive experiences, and targeted marketing for each customer at scale.

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