Important e-commerce terminologies you need to know
Every sector and business has its own language. This is the same with e-commerce and digital retail. However, with the ever-changing nature of e-commerce, there are always new trends, technologies, and terminology to learn. Knowing these terms is critical to relating better with suppliers and other businesses and will help you understand where more or less work is needed to attract, convert, and retain consumers.
These are terms you might encounter when you embark on an online payments journey with us.
The Klasha beginner e-commerce glossary
1. Business to business (B2B): Business-to-business (B2B), also known as B-to-B, is a type of transaction between businesses. In this scenario, one company offers products or services to other companies. B2B takes place between two or more companies rather than between a company and a single customer.
2. Business to consumer (B2C): A business-to-consumer, or B2C, is one in which a company sells a product or service directly to a customer.
3. Cart abandonment rate: Cart abandonment rate is the percentage of online customers who add goods to a virtual shopping cart but abandon it before making a purchase. When compared to the total number of shopping carts produced, it reveals the percentage of interested potential consumers that leave without purchasing anything.
4. Chargeback: A completed card transaction that is reversed—typically because a consumer disputes a charge and the merchant's bank refunds the transaction's value.
5. Checkout: Checkout means that a customer is ready to pay for the items in their cart. At this point, customers can pay for their goods using their preferred payment method
6. Conversion/Conversion rate: Conversion occurs when a visitor asks for a quote, fills out a contact form, or makes a purchase. However, the conversion rate is the percentage of online store visitors that become paying customers or take the required action.
7. Dropshipping: Dropshipping is an order fulfilment technique in which items are sent straight from the supplier to the consumer, with no interaction from the seller. This strategy removes storage, lowers expenses, and allows new businesses to expand quickly
8. Plugins: This is a special type of software, which can be added to another program, app or web browser in order to offer extra capabilities. In other words, it plugs special features and extras onto your website, making it operate more efficiently in line with your online business needs—for example, Woocommerce.
9. Integration: In the e-commerce arena, it refers to the coordination of information between two ‘pieces’ of software. For example, a business’s online store and its back-end inventory and accounting software. This means data only has to be captured once and can be tracked across different platforms automatically
10. Fulfilment: Fulfilment is the entire process of having an order delivered to a customer after online purchase. It includes the receipt, processing, packaging, and shipping of orders.
11. Inventory: Inventory is a term used to refer to goods that are in various stages of being made ready for sale.
12. Payment gateway: A payment gateway is an online payment service that is used to make and receive payments when integrated with an e-commerce platform. The online payment gateway acts as a facilitator, allowing the customer’s bank to communicate with the merchant’s bank for the smooth transition of funds; for example, Klasha
13. Recurring payment: Recurring payments refer to when a customer authorizes a retailer or merchant to deduct payments for products or services from his bank account or automatically charge his credit card in the amount due each month.
14. Shipping: Shipping is the actual movement of goods from one location to another, such as items from the warehouse to the consumer.
15. Shopping cart: A virtual shopping cart that displays the goods a consumer has selected for purchase on your website.
16. Domain name: Also known as the URL, it’s the web address of your online store or website, e.g. www.klasha.com
17. SSL: SSL stands for Secure Sockets Layer, and it's the industry standard for keeping an internet connection secure. It secures any sensitive data exchanged between two systems, preventing thieves from accessing and altering any data received, including potentially personal information.