Ecommerce Terms: You’ll notice that every industry has its own language – often times, it’s a niche language that only the people living and working within a specific industry can understand. The words used in the technical industry are not only many, but also particularly complex. With the rise of eCommerce businesses, leaders and members of the field are having to quickly learn the language. Whether you are getting ready to launch your business or have been in the industry for a while, we thought it would be helpful to put together a glossary of terms used in the language of eCommerce. This glossary will be divided into various parts to keep you up to date with the latest terminology.

A/B Testing

Otherwise known as split testing, A/B testing is the method of assessing two different variables on a web page to see which one performs better. This is done by presenting either variable to users at random, and performing statistical analysis to determine which one leads to more conversions. You might show 50% of your website visitors one call-to-action, and the other 50% a different call-to-action. The version that then generates the highest conversion rate would be considered the most effective.

Bounce Rate

Bounce rate represents the percentage of visitors who enter your website and leave without taking further action. It is calculated by dividing the amount of one-page visits by the amount of overall visits to the website.

Call-To-Action

A call-to-action is a marketing message used to persuade the user to take a specific action. A CTA might be “start now” or “add to cart” – the most effective ones are often those that instigate a sense of urgency in the user.

Cart Abandonment Rate

Cart abandonment rate refers to the ratio of website visitors who add items to their cart but end up abandoning the webpage before they check out. The CTA rate is the number of completed transactions divided by the overall numb.

Content Management System (CMS)

A CMS is a software that allows ecommerce companies to manage, edit and publish the content of their online store. Shopify and Magento are examples of content management systems.

Conversion Funnel

The conversion funnel is a metaphor used in the marketing industry to represent your customers’ journey from becoming aware of your business to taking action, such as buying your product. The funnel includes various steps: awareness, interest, desire, action/conversion and re-engagement.

Conversion Rate

The conversion rate represents the percentage of your website visitors who ended up completing your desired action. Ecommerce businesses often calculate the conversion rate based on the number of visitors who completed a purchase or signed up for emails.

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