The ecommerce industry is in a state of flux. It is constantly changing with new trends, technologies, and strategies surfacing and disappearing, making it difficult to stay on top of.

It’s okay to struggle at first and not know what everyone is talking about. We’ll be the first to admit, some of these terms can come across as rather silly to the uninitiated but they are very effective at succinctly describing processes, strategies, and KPIs.

To do your job effectively as an owner of an ecommerce startup, you have to become familiar with the associated buzzwords your competitors are actively using in the industry. You have to learn terms like long-tail, bounce rate, and conversion.

Furthermore, the list of ecommerce buzzwords expands every year. This is because the industry’s landscape is changing, and the verbiage changes along with it. New words make it into the glossary as old ones fall out of trend, and it’s your job to keep up with these changes.

In this glossary page, we’ll deep dive into the ecommerce buzzwords of 2022. Let’s get down to brass tacks.

A/B Testing

A/B testing (also known as bucket testing) lets you compare two versions of a web page or app to see which variant is more effective.

API

An Application Program Interface connects two applications to communicate with each other. This is important when you want to integrate your ecommerce store’s various plugins, including payment gateways and email autoresponders.

Adwords

Google provides advertisement spaces to marketers. They use the pay-per-click model for different keywords. Advertisers set a budget for each ad, which is used when prospects click on the ad.

Bounce Rate

The percentage of that are single-page website visits is referred to as bounce rate. This means the user left your website without viewing a second page. This metric is used to measure the overall engagement rate of the website.

Sales Funnel

Also referred to as the ‘conversion funnel, the sales funnel describes the journey potential customers go through before completing a transaction. There are several steps involved in a sales funnel. The most common ones include (in this particular order): awareness, discovery, interest, decision, and conversion.

Conversion

Conversion is when your visitor responds to your call-to-action (CTA). Your CTA could include signing up for the newsletter, downloading an ebook, submitting reviews, and making a purchase.

Abandonment Rate

This term is frequently associated with the shopping cart. It refers to the ratio of abandoned shopping carts compared to successful transactions.

Plugins

Different software that integrates with your ecommerce store to extend the features, services, and capabilities of your platform. Plugins can be used to complete payments, optimize website speed, sell digital goods, and more.

301 Redirect

A 301 redirect indicates that a webpage has permanently moved to a new location. 301 redirects are useful when a webpage is no longer useful or has been removed.

404 Error

It’s when users try to find a page that is not available on your ecommerce store. It means the website itself is loading, but the specific page the user is looking for is not available.

Cookies

Ecommerce stores use cookies to record user information and their browsing habits. This information is then used to provide a personalized shopping experience to customers. Cookies are also used for advertisement, including retargeting campaigns.

Landing Page

The destination page visitors land on when they click on the search engine result link. Landing pages apply to both organic and paid results.

SEO

Search Engine Optimization is a strategy that seeks to optimize a web page for various search engines (primarily Google and Bing) to increase website traffic.

SERP

Search Engine Results Pages (SERP) display query results for different keywords. These pages may also provide space for advertisements, including product placements from your ecommerce store for customers to buy.

Address Verification Service

A fraud prevention system used by ecommerce stores to prevent faulty credit card transactions. AVS compares the billing address entered by the customer to the one on their credit card account.

Favicon

The favicon is a portmanteau of ‘favorite’ and ‘icon.’ It is a small square icon that serves as branding for your ecommerce store. It can be used in browser tabs, search bars, bookmarks, and toolbar apps, among other places.

Brick & Mortar

A traditional store with a physical location may also have access to an ecommerce website. This business model provides your customers with the best experience because they can enjoy the convenience of shopping online and visiting the store in person to test out the products.

Gateway

This is a technology that facilitates credit card transactions for merchants. In the context of ecommerce, it refers to ‘checkout’ portals where customers enter credit card information to authorize payments.

Growth Hacking

It’s a strategy that uses KPIs and low-cost approaches to help ecommerce stores acquire and retain new customers.

Affiliate

An affiliate is a special commercial arrangement where one entity (celebrity, influencer, or firm) sells someone else’s products on their website. A small percentage of the sales are provided to the affiliate marketer.

Algorithms

Algorithms are widely used to increase the customer acquisition and help users learn from on-site data.

B2B

Business to Business (B2B) is an umbrella term that refers to all transactions conducted between two businesses, such as a manufacturer and a wholesaler. The marketing strategy deployed for B2B ecommerce stores is usually very different from those used for B2C stores.

JavaScript

A scripting language lets ecommerce stores deploy interactive media to make the web pages more engaging.

KPI

Key performance indicators are metrics used to measure the success of an ecommerce store. They can be used to track the growth of sales, customer acquisition targets, and other business objectives.

COGS

Cost of Goods Sold (COGS) indicates the cost associated with selling a product. It includes various overhead expenses such as employee wages and manufacturing the product.

Inventory Levels

Inventory levels refer to the quantity of inventory an ecommerce store has for its network.

Store Credit

Offers customers rewards (usually in the form of points) to follow through with a transaction. Once the customer has acquired a certain threshold of points, they can qualify for discounts and even free products. In this way, store credit is very similar to loyalty programs.

SAAS

Software as a Service (or SaaS) is a model that delivers a set of programs hosted on the cloud-based for use on your ecommerce store. These programs are cloud-based and can be accessed using any computer or smartphone with access to the internet.

Outsource

It is the practice of using third-party vendors and companies to provide services and create goods.

Web Analytics

A set of tools that measure, analyze, and report data generated on the ecommerce store to understand how customers and visitors interact with the site. This information is then used to improve the conversion rate.

Blogging

These are a set of content tools to help your ecommerce store increase its online visibility. The content is often used in the context of search engine optimization and focuses on subject matters related to the target niche. For instance, a store selling fitness products will talk about workout, exercise, and hypertrophy subjects.

Buyer Persona

A fictitious profile that depicts target customers. A business can have multiple buyer personas depending on the kinds of products or services it sells.

UI

User Interface (UI) is the visual aspect of the website or application used by ecommerce stores to provide end-users with an intuitive navigation experience. It comprises of screen menus, keyboard shortcuts, gesture movements, and more.

CTA (Call to Action)

Call to Action prompts prospects on what they should do next, where they should click, what to buy, and actions they should perform. It provides a path to checkout and converts prospects into paying customers.

CRM

A CRM (customer relationship management) is designed to help ecommerce stores manage and coordinate customer interactions. A CRM can be used to maximize the value of customer interactions to improve corporate performance.

Click-Through Rate  

This is the ratio of users who view your ads to those who click on the ads.

CAC

Customer Acquisition Cost (CAC) is the cost of acquiring a new customer. It can include the cost of advertising and the salary (or compensation) paid to your marketing team. CAC helps you measure the ROI on your advertisement efforts.

Chargebacks

Chargebacks are designed to protect cardholders from fraud. It is the reversal of funds to customers. Chargebacks are usually applicable when the customers feel as if they have been sold a sub-standard product.

Cross-Selling

The practice of selling different products or services to existing customers. The goal is to intend additional products without changing the customer’s intention on what they originally set out to purchase.

Discount Code

Discount codes (also known as promo codes or coupons) consist of letters and numbers entered by customers to avail of special discounts and offers on the site. These codes can be obtained via advertisements and emails.

Wrapping Up

So there you have it, the most important ecommerce buzzwords of 2022 that you should know.

It’s okay if you can’t memorize some of these words. You don’t need to know them all, and some of them may not even be relevant to your niche.

But, using these terms makes it easier to communicate with others in the industry and saves a lot of time. Don’t know when to use these buzzwords? As a general rule, if the buzzword provides the clearest pathway to communicating something, use it. But if there’s a more elaborative way of saying what you mean, don’t hesitate to go with that approach.

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