Jargon is part of everyday life within advertising and marketing. Every eCommerce client I deal with will have heard me mention conversion rate or payment gateway. However, taking a step back and realising that not everyone knows what PCI or AOV means. This leads to our eCommerce jargon buster and hopefully improving your knowledge and understanding.

eCommerce Jargon Buster (Updated July 2017)

Anonymous checkout – A checkout process where a user completes the transaction without creating an account on the seller’s website. Also referred to as ‘guest checkout’

Average order value (AOV) – The average amount spent per customer order. Often used as a performance metric. E.g. “As a business owner, looking at the average order value is a great metric to gauge annual revenue growth.”

Category – In eCommerce, products are often grouped into a hierarchy of categories and subcategories. E.g. “Our bespoke furniture eCommerce store is organized using categories like bedroom, living room and home office. Subcategories include type of wood finish.”

Checkout – The process of providing information to complete an eCommerce purchase. Steps typically include billing
information, shipping information, order verification and order confirmation. E.g. “Best practices in eCommerce require having a user-friendly and smooth checkout process.”

Conversion – A tracked, successful action that website visitors complete.

Conversion rate – The ratio of conversions to visits, often used to measure digital performance. For example, if you have received 200 clicks and 5 conversions, your conversion rate is 2.5%. E.g. “I improved my conversion rate by including the words ‘free consultation’ – a lot more people sign up now.”

Coupon code/ discount code – A special code a customer may enter during checkout to apply a discount.

Drop-ship – A method of fulfilling orders where a retailer has items shipped directly from the manufacturer or supplier to the customer.

eCommerce – The commercial trade of products and services over the internet.

eCommerce platform – A software program or application that lets businesses sell online. Features of eCommerce platforms vary but they generally include product information, customer account management, shopping cart and checkout processes, product search capabilities and order management.

Fulfillment – The process of completing and delivering purchased products or services to the customer. E.g. “Every online seller has to consider the most cost-effective method for fulfillment.”

Inventory – A complete list of a seller’s current stock.

Merchandising – The placement and display of products to entice a customer to make a purchase. Examples include ‘featured item’ lists, specific product promotions, and recommendations of top sellers or related products.

Merchant account – An account a retailer holds with an institution such as a bank or payment gateway provider i.e PayPal. The account is defined by a contractual agreement that allows the seller to accept credit cards or other common types of payment on an eCommerce website.

Order confirmation – The final step of the checkout process, where a customer is informed that their order has been placed successfully. This message is usually delivered on screen and by email.

Payment gateway – A service provider that authorizes online payments. E.g. “Payment gateways allow customers to make purchases with bank or credit cards with the simple push of a button.”

Privacy policy – A statement that explains what customer information an online retailer will collect and how the retailer might use that information. E.g. “Our company’s privacy policy reassures customers that we only collect minimal information and we never sell email addresses to third parties.”

Product feed – A file that contains a list of product inventory and product details. This file can be made available to other services in order to promote the products contained in the feed. E.g. “We uploaded our company’s product feed into a search engine’s merchant database so our products would show up when they match a search.”

Product recommendation engine – Software that suggests specific products to customers on a website, based on available information. E.g. “The product recommendation engine on our bespoke furniture site suggests matching chairs for every table and desk.”

Registration – The process of creating a customer account with an online retailer. The account holds personal information such as name, billing and shipping address, and payment details.

Return policy – A statement that explains when, how and under what conditions a customer may return products purchased from the retailer. E.g. “Our return policy, linked at the bottom of our website, explains that bespoke furniture cannot be refunded unless faulty.”

SSL certificate – An SSL certificate is a file that is installed on a web server to encrypt sensitive information that is being transmitted – for example credit card details entered on a website. It also assures customers that a site is using a trusted and secure connection. Retailers can purchase an SSL certificate through a certificate authority.


eCommerce Jargon Buster


Shipping / Delivery – The sending of purchased products to a consumer. Shipping may also refer to the additional fees charged by the retailer to cover the cost of delivery. E.g. “During the checkout process, shipping is calculated based on the total weight of the furniture being purchased.”

Shopping cart – The functionality of an online store that lets visitors add multiple products to a single order. E.g. “Having a shopping cart on your site is essential to allow users to browse and buy multiple items.”

Stock keeping unit (SKU) – A unique identifier given to individual products to track inventory and differentiate between items for sale. E.g. “Using SKUs has helped our business keep track of what stock we have in what location, so we can optimise inventory management.”

Tax – In eCommerce, this refers to the total taxes that must be collected per local laws and policies as part of an
online order. For example VAT when applicable in the United Kingdom.

Our eCommerce jargon buster will be revisited and updated regularly to ensure that we can help you break through a digital agencies everyday jargon. If you would like to add to our eCommerce jargon buster please let me know in the comments below or by contacting us directly.