eCommerce, Ecommerce, e-commerce; however you spell it, the term is now firmly lodged in our language in the recent few years. The following are definitions of the more widely used terms related to eCommerce or Online Shopping:


Commercial trading process of products and services online.

Platforms like websites or mobile applications allow people to sell products and services online. Features of platforms differ but they generally include products listing and sorting, user accounts and profiles, shopping cart, order management, shipping management, offer management, checkout option and payment gateway.


Mobile Commerce is a trading process of products and services through wireless handheld devices like mobile phones and tablet PCs.


B2B stands for Business to Business. Trade between two business entities that are not final consumers of products or services.


B2C stands for Business to Consumer. Business transaction between a business and a consumer.


B2B2C stands for Business to Business to Consumer. It is an e-commerce business model that combines B2B and B2C for a complete product or service transaction. B2B2C is a collaboration process that creates mutually beneficial service and product delivery options.


An online marketplace is a type of e-commerce website/mobile app where products or services are listed and sold by multiple third parties, whereas transactions are processed by the marketplace operator.
E.g.: Websites like Amazon, Flipkart, eBay, Taobao, AliExpress etc.


A method of fulfilling orders where an online seller does not store products and ship from their location, but instead has the ordered items shipped from a manufacturers’ or suppliers’ location to the customer.


A complete list of sellers’ current product stock for sale.

Stock Keeping Unit (SKU)

A unique identifier given to individual items to track inventory/product lists 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 optimize our inventory management.”


Products grouping option into different categories and sub-categories based on price, color, size, brands, offers etc.

Merchant account

An account an online seller holds with an institution such as a bank or payment gateway provider where the account is defined by a contractual agreement that allows the seller to accept credit cards, debits cards, net banking or other common types of payment on an eCommerce website or mobile app.

Payment gateway

A service provider that authorises payments made online via credit cards, debits, digital wallets, net banking etc. Payment gateways enables online sellers to receive payments from the customers online.

Shopping cart

The functionality of an eCommerce website or app that lets users add multiple products to their online rolley to checkout at once. E.g. “Having a shopping cart feature on your website is mandatory to allow users to browse, search and buy multiple items.”

Checkout process

The process in which a user decides to provide shipping and billing information, make payment for the products in his/her cart and complete transaction.
E.g. “Best practices in eCommerce require having a user-friendly and smooth checkout process.”


In an ecommerce context, registration refers to the ability to create an account with the website or app where you can store your personal information such as your name, address, email, phone number and payment details. The registered users can accelerate the checkout process.

Guest Checkout

An online purchase option where a customer can add products to cart, enter billing and shipping information, pay for the items and complete the transaction without having to create user account on an eCommerce website or mobile app.

Order confirmation

Last step of the checkout process, where order successful placement is informed to the customer. This message is usually displayed on screen and delivered by email and SMS.

Coupon code or Discount code

An offer code a customer may enter during checkout process to receive discount on total price.


The delivery of purchased products to customers. Shipping charges also refer to the additional fees charged by the sellers to cover the cost of delivery. E.g. “During the checkout process, shipping fees is calculated based on the location of the customer.”


Process of delivering goods or services to the customers and completing orders.


Placement and display of items to attract a customer to make a purchase. Examples include ‘top sellers’ lists, specific item promotions, and recommendations of featured items or related products.

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 product feed into a search engine’s merchant database so our products would show up when they match a search.”

Product recommendation engine

Software program that suggests specific products to customers on a website, based on available information and user search behavior.

Privacy policy

A statement by eCommerce website or app owners that explains what customer information will be collected and how they might use that information.
E.g. “Our company’s privacy policy assures customers that we only collect basic customer information and we never sell email addresses and phone numbers to third parties.”

Return policy

A statement by eCommerce website or app that explains how, when and under what conditions a customer may return products purchased from them.

SSL certificate

An SSL certificate is a file that is installed on a server where website is hosted to encrypt and secure sensitive information that is being transmitted – for example credit card details entered on a website. It also assures customers that a website is using a trustworthy and safe to transact on. eCommerce website owners can purchase an SSL certificate through a certificate authority or a hosting services provider.

Transaction email

An automated or manually sent email related to specific action by seller or buyer like new order placement, processing order, cancelled order, refunded order, failed order, order invoice, completed order, registration etc.

Average Order Value (AOV)

The average amount spent on a website or app per customer order. AOV is often used as performance metric.
E.g. “As a business owner, looking at the average order value is a great metric to gauge annual revenue growth.”


A tracked and successful action that businesses want their website or app visitors/users to take. In the context of eCommerce, it can be a successful order placement or download.

Conversion rate

The ratio of number of conversions to number of visits. It is often used as performance metric.
E.g., if you have received 300 clicks and 15 conversions, your conversion rate is 5%.