A quick guide to common e-commerce jargon

5 Mins Read
facebook sharing button
twitter sharing button
linkedin sharing button
Smart Share Buttons Icon Share

Suppose you are a new business owner wishing to venture into the world of e-commerce – you might find yourself confused regarding the jargon that circulate on the internet and among the stakeholders. You might wonder what affiliate marketing, business-to-business marketing, business-to-consumer, and other similar e-commerce terms mean. If that is the case, you have come to the right place. This guide will dive into a glossary of buzz phrases in e-commerce today.

What are the terms of e-commerce?

Below are 10 of the essential  jargon – or rather, keywords – used in e-commerce:

1. Affiliate marketing

Online affiliate marketing is performance-based marketing where you pay an affiliate for every customer that they refer to your website and makes a purchase. The affiliate is another established online brand  that refers a customer to your website, and you pay them for every resulting conversion. A few examples of affiliate marketing programs include GiddyUp, DFO Global, Amazon Associates and eBay Partner Network.

2. Business to business (B2B)

B2B refers to the business between two firms, for example, a manufacturer and a wholesaler or a supplier with a retailer. A business sells a selection of goods or services to another business, also known as a business-to-business transaction. The vendor's goods and services are then used by a specific team or division. B2B businesses exploring the e-commerce scene have to leverage powerful marketing techniques to target the B2B market and improve lead quality, sales acceptance of leads and conversion rates.

3. Business to consumer (B2C)

B2C means selling a company’s services or products directly to the end-users. Popular e-commerce websites such as Amazon, eBay, and Flipkart are examples of business-to-consumer  entities where consumers buy directly from a brand.

4. Bounce rate

Bounce rate is the percentage of visitors on your website who navigate away from it without viewing other web pages. A higher bounce rate means there are negative elements on the site that drive visitors away. By studying these elements, e-commerce website owners can sieve out the issues and take appropriate measures to encourage visitors to stay on.

5. Call-to-action (CTA)

CTAs are usually words or phrases that are added on different web pages that persuade the visitor to take immediate action – such as make a purchase – and therefore, increase conversion rates. A few common CTA’s include ‘buy now’, ‘call now’, ‘sign-up today’, and ‘click here’. A B2C or B2B website experience that is more personalized can encourage higher CTA click-through rates.

6. Conversions and conversion rate

Conversion is a term used to refer to the situation where a visitor performs an action in line with your business goal. For instance, if you have set up a page for visitors to sign up for an event, each registered user amounts to a conversion. Reading a full blog, clicking on a link in an email newsletter and successfully carting out online are other various examples of conversions. In other words, a conversion usually happens as a response to a CTA. A similar concept is the conversion rate which is the percentage of viewers or visitors that convert. 

The conversion rate is an important e-commerce metric that can be used to assess the effectiveness of both  B2B and B2C marketing strategies and how much value they bring to the business. Optimizing your conversion rate will give you the returns you imagined.

7. Conversion funnel

The conversion funnel refers to the different stages along a consumer’s journey when making a purchase. Using a purchase as an example of a conversion, the funnel starts with the point where the customer finds out about your brand (awareness); he then relates to your brand and products (consideration); afterwhich, he initiates the purchase process and buys the product (conversion). It is referred to as a funnel since, at every stage, the number of visitors drops so the number of potential leads at the conversion stage is reduced.

Image showing discover app on a mobile screen

Subscribe to the Discover newsletter

  • Fortnightly insights, tips and free assets
  • We never share your data
  • Shape a global audience for your business
  • Unsubscribe any time
Image showing discover app on a mobile screen

8. Search engine optimization (SEO)

SEO refers to the process of improving a website’s ranking in search engine results. An e-commerce website is essential for any B2B or other business, but the website is of no use if it does not appear in search results when people try to search for related keywords.

The idea here is to adopt various measures through which your website will rank higher on search engines and consequently drive traffic towards your website. The most common SEO techniques include publishing relevant and authoritative content with relevant keywords, adding internal and external links, optimizing title tags, updating old content and monitoring analytics. Even working on your product listings on your website or marketplaces go a long way in your online search performance.

9. Web analytics

Web analytics is an e-commerce terminology that refers to the process of measuring, collecting and analyzing web data. This  allows you to understand and assess web usage and performance, so you can take measures to improve the website’s effectiveness. 

Web analytics measure numerous areas, such as the number of visitors, how long they stayed on each website, which pages they visited, what keywords they used while searching and landing on a particular page, whether they arrived on your website from search or an external source , and when they left the website. Tools used to record and analyze such information are plenty, but Google Analytics and Adobe Analytics are more popular today. 

10. Payment gateway

When customers shop online, they have to navigate a payment gateway in which they select how they wish to pay for the product and then fulfill the corresponding processes involved. On top of card payment, you can consider secure applications like PayPal and Stripe, or link up with digital wallets like GrabPay and Apple Pay. Another layer of this gateway comes in the form of buy now, pay later payment options where customers can choose to pay for their purchases over a number of fixed interest-free installments. Popular platforms offering this include Atome, Afterpay and Hoolah. While these services are also available at brick and mortar stores, it’s more critical to provide such payment options in the online sphere so your customers can enjoy the flexibility of shopping on their own terms.