Some Common Ecommerce Terms Explained
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In ecommerce, the “place” customers shop is the website, sometimes called the storefront. Software controls the appearance and functionality of the website. Fortunately almost every type of website creation software - html coding, blogging, content management platforms - have ecommerce tools. Shopping carts, merchant card processing, links to Paypal and other popular payment systems can be added to websites even if they’re not built into the original design.
Common marketing practices include advertising the storefront on other websites, using search-driven services such as Google AdWords, creating information-packed email publications called ezines, and opt-in newsletters, which require potential customers to request the information.
When customers click on the link in a newsletter, ezine, or ad, they are taken to a landing page - a page within website page or the only page of the website where the customer goes, i.e. lands. The purpose of the landing page must be very specific. The most common purposes of landing pages are to either sell a product or get the viewer to submit their contact information, usally their first name and email address. Landing pages are very effective to build an email subscriber list and sell products.
The success rate of a Landing Page is called the conversion factor. The conversion factor is the ratio of how many people buy or subscribe compared to how many people have visited . Each new visitor counts as a page impression, or hit. Tracking these numbers gives the seller an idea of how effective their marketing efforts are. Advertisers charge by how many page impressions are delivered or by the number of clicks. Therefore knowing the conversion rate of your landing page is critically important.
Items positioned above the fold are those that appear in the part of the web page that first shows up when the storefront is loaded. In etailing, it is common practice to use this prime position to promote those products or services that the company most wants to customers to see. Often visitors never scroll down below the first page - the fold - therefore if the information above the fold isn’t compelling you’ll lose the visitor immediately.
When customers visit the storefront, cookies are deposited in their computers. Cookies are small files that track the customer’s preferences. For example, cookies record what pages have been visited and what products have been placed in the customer’s shopping cart. Cookies are how the website remembers your name when you revisit a site. Cookies have many uses, such as recording your website information if you direct them to another site.
The shopping cart is the software that tracks items the customer selects for purchase, calculates the sales total, and collects payment information. This software can be incorporated into the storefront and managed by the etailer, or into a separate program that etailers contract an independent party to maintain and host.
Offering multiple payment options is one way to make the process easier for customers. Online sellers typically accept payment via PayPal (an online funds transfer service), by credit cards, and through echecks which take funds directly from the customer’s checking account.
Customer relations management (CRM) refers to all practices and procedures the seller uses to ensure a positive experience for customers. This can include providing live support or a toll-free number, sending confirmation and thank-you emails following a purchase, offering a fair and efficient return and refund policy, and maintaining contact after the purchase to encourage repeat business.
Like any new field, ecommerce has its own language and culture. Understanding the vocabulary removes the confusion and makes online sellers more effective in their marketing and sales efforts.
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