Plain-English Glossary of Ecommerce Terms

Abandoned Basket
When a customer adds items to their online basket but leaves without completing the purchase. Often targeted with reminder emails.

Accessibility
Making your website usable for everyone, including people with disabilities. This includes readable text, keyboard navigation, and alt text for images.

Add to Basket Rate
The percentage of visitors who add at least one product to their basket. A key measure of product page effectiveness.

Attribution
A way of working out which marketing activity influenced a sale. For example, did the customer click an ad, read a blog, or come through email? Attribution models share credit across these touchpoints.

Average Order Value (AOV)
The average amount spent each time a customer places an order. Calculated by dividing revenue by number of orders.

Basket-to-Checkout Rate
The percentage of customers who move from viewing their basket to starting the checkout process.

CAC (Customer Acquisition Cost)
The average cost of winning a new customer. Includes media spend, creative costs, and related fees.

Chargeback
When a customer disputes a payment with their bank and the money is reversed. High chargeback rates are a warning sign of fraud or poor service.

Consent Management
The process of capturing and honouring customer choices about data use and marketing. For example, opt-in checkboxes and cookie preferences.

Contribution Margin
What’s left from each order after covering variable costs like product, fulfilment, and marketing, but before overheads. A more useful measure than revenue alone.

Conversion Rate
The percentage of visitors who complete a purchase. A central metric for ecommerce performance.

CRO (Conversion Rate Optimisation)
The process of improving a website so more visitors complete desired actions, usually making a purchase. Involves testing, refining, and removing friction points.

CRM (Customer Relationship Management)
A system for storing customer data, order history, and interactions. Used to manage relationships and create targeted communications.

Customer Lifetime Value (LTV or CLV)
The total value a customer brings to your business over their whole relationship with you, not just their first order.

Data Flow
The movement of data between systems – for example, stock updates flowing from your warehouse to your website, or orders flowing into your finance system.

D2C / DTC (Direct to Consumer)
Selling products directly to customers through your own website or marketplaces, instead of only via retailers or distributors.

Dashboard
A visual display of key metrics. Dashboards simplify complex data and make performance easier to monitor.

ERP (Enterprise Resource Planning)
A type of software that manages core business processes like inventory, finance, and production. Often linked with ecommerce platforms for smoother data flows.

Fulfilment
Everything that happens after an order is placed, from picking and packing to shipping and handling returns.

Green Claims Code
Guidelines published by the UK’s Competition and Markets Authority (CMA) that set standards for environmental claims. Designed to stop misleading or vague sustainability messaging.

Integration Map
A diagram showing how your systems connect – ecommerce platform, finance, warehouse, CRM, analytics – and how data flows between them.

KPI (Key Performance Indicator)
A measurable number that shows progress toward a goal. For example, conversion rate, repeat purchase rate, or contribution margin.

Margin Ladder
A step-by-step breakdown showing how £100 of revenue reduces after VAT, cost of goods, fulfilment, fees, and marketing, leaving contribution profit.

Marketplace
A third-party platform like Amazon, eBay, or Etsy where products can be listed and sold. Offers reach but reduces margins and control.

Omnichannel
A joined-up customer experience across multiple channels – for example, a consistent brand presence online, on social, in marketplaces, and offline.

Opt-In
When a customer actively agrees to receive marketing or communications, usually by ticking a box. Required under GDPR rules.

Payment Gateway
A service that processes online payments securely, such as Stripe, PayPal, or Shopify Payments.

Personalisation
Tailoring content, recommendations, or offers based on customer behaviour or preferences.

PIM (Product Information Management)
A system for storing and managing product data, such as specifications, images, and compliance information, in a centralised, structured way.

Preference Centre
A self-service area where customers choose what marketing they receive, how often, and through which channels.

Privacy Policy
A document on your website explaining how customer data is collected, used, stored, and shared. A legal requirement under GDPR.

Product Content Standards
Guidelines that ensure every product page has consistent, high-quality content, including photos, descriptions, specifications, and delivery details.

Returns Policy
The rules you publish for how customers can return products, how long they have to do so, and how refunds are processed.

Risk Register
A simple log that identifies potential risks, how likely they are, and how you plan to respond if they occur.

SEO (Search Engine Optimisation)
Improving your website so it shows up higher in search results, helping bring in free traffic over time.

Service Level Agreement (SLA)
A documented commitment on service standards, such as response times, delivery times, or refund processing.

Stage Gates
Minimum requirements that must be met before moving from one stage of ecommerce growth to the next – for example, from Getting Started to Getting Going.

UGC (User-Generated Content)
Photos, videos, and reviews created by customers. Adds authenticity and builds trust in your brand.

Unit Economics
The financials behind each order – looking at revenue, costs, and profit at a per-unit level, rather than only at total sales.

Upsell / Cross-Sell
Encouraging customers to buy a more expensive product (upsell) or a related product (cross-sell) alongside their main purchase.

UX (User Experience)
How easy, fast, and enjoyable it is for someone to use your website.

3PL (Third-Party Logistics)
A company that handles storage, picking, packing, and delivery on your behalf. Useful for scaling without managing your own warehouse.