You are using an outdated browser. For a faster, safer browsing experience, upgrade for free today.

The Dropship Dictionary

We’ve put together our own dictionary of popular and common terms used in Drop Shipping and eCommerce.

 

301 Redirect 

This refers to a permanent redirection from one URL to another, sending site visitors and search engines to the new URL rather than the other (the one they originally typed in). 

 

Address Verification Service (AVS) 

A process that every credit card company implements in their system which allows them to verify whether the billing address of the credit card provided by the user matches the address provided on the credit card statement. 

 

Affiliate 

An affiliate is a type of inter-company relationship where one firm sells other merchants’ products on their own website.

An affiliate is often paid commission by the merchant on each sale. Also known as: commercial partner 

 

Affiliate Marketing 

This refers to an external website that refers a customer to your online site.

Again, they are often paid commission on each sale they helped to make. 

 

Amazon Marketplace 

The largest 3rd party ecommerce platform. Amazon charge fees on every sale made through the Marketplace and also offer Fulfilment by Amazon (meaning they handle the whole fulfilment process) for your business at extra cost. 

 

Application Programming Interface (API) 

An API is a set of protocols, specifications or instructions allowing two software applications to interact and exchange data.

It’s used for developing software applications where it acts as an interface between different software programs and allows interaction. 

 

Authorization 

The process of granting permission to someone to allow them to give orders, make decisions or take an action. 

 

Bounce Rate 

The percentage of visitors who navigate away from the website without visiting other pages of the site.

A bounce is also called a single-page session, which implies that only a single request has been sent to the server.

This is because a user opens one page on the site and exits without triggering any other requests in the same session. 

 

Brick and Mortar 

A business that has a physical store that customers can go to, rather than just having an online presence. 

 

Business to Business (B2B) 

The process of selling services or products to another business, which typically then sells to the consumer. 

 

Business to Consumer (B2C) 

The process of selling services or products directly from the business to the consumer. 

 

Buy-To-Detail Rate 

This refers to the number of products purchased per number of product-detail views;

Buy-to-Detail Rate = Total Unique Purchases of product / Product Detail Pageviews 

 

Buyers Persona 

The Buyers Persona is a semi-fictional representation of your prospective customer based on market research and real data of your existing customers.

A buyers persona  reveals insights about buyers’ decisions, their specific attitudes, concerns and criteria.

 

Call-to-Action 

These are words or phrases incorporated in a message of sales script that induces a viewer, reader or listener to take immediate action.

 

Chargeback 

A transaction reversal meant to serve as a form of consumer protection from fraudulent activity committed by both merchants and individuals.

A credit-card provider may demand for a retailer to make good the loss on a fraudulent or disputed transaction. 

 

Click Through Rate (CTR) 

A ratio showing how often people who see your ad end up clicking on it.

CTR can used to gauge how well your keywords and ads are performing.

 

Closed-Loop Marketing 

The collection of customer data from multiple channels, which is then analysed and used to create appropriate content for targeted groups of customers. 

 

Cohort Analysis 

An analysis of customer behaviour who are separated into groups of people with the same / similar attributes.

Also involves examining how specific characteristics of a cohort (group) changed over time. 

 

Content Management System (CMS) 

A back-end solution developed to control the content of the website which is the front-end.

This software application allows you to create, edit, maintain, publish and display content on the internet from a single administration tool. 

 

Content Optimization System (COS) 

This is a holistic solution designed to help you manage your website and other components of digital marketing all together in one system. 

 

Conversion 

The point when an anonymous website visitor converts into a customer after making a purchase. 

 

Conversion Funnel 

This term is used to describe the series of events that occur during the customer’s journey of buying goods online. 

 

Conversion Rate 

A marketing concept measured in percentage; the rate at which visitors convert on a site.

The percentage of visitors who take a desired action.

Conversion Rate = Number of Conversions / Number of Visitors to Site 

 

Cookies 

Text files sent to a user’s browser related to how the customer interacts with the website.

Users often receive pop-ups that requests that the user “share cookies”.

After confirmation, the information in these text files is sent back to the server, based on how the user responded and interacted with the site. 

 

Cross-Selling 

A marketing tactic where sellers present additional products that can complement, enhance or improve the main product they are selling.

E.g. Headphones / Charging Cables for mobile phone purchases. 

 

Crowdsourcing 

A practice of intellectual gathering of information that comes from loosely defined external group(s) of people to achieve a business-related goal.  

 

Customer Acquisition Cost (CAC) 

The cost associated in acquiring and convincing potential customers.

This helps to determine how to allocate resources while gaining new customers. 

 

Customer Lifetime Value 

A prediction of a total value (total net profit) an eCommerce company would make from the lifetime relationship with any given customer. 

 

Customer Relationship Management (CRM) 

A practise that helps an organisation to manage and analyse customer interactions throughout the customer life-cycle to improve customer relationships in order to achieve a business goal.

 

Cyber Monday 

The Monday after Black Friday.

Historically, this day have more deals and discounts than any other day of the year.

Over the last few years, it is claimed that Cyber Monday has exceeded Black Friday in overall sales. 

 

Domain 

A unique name which is part of the network address that locates an organisation or other entity on the internet.

Domain names are formed by rules and procedures of the Domain Name System (DNS) which is a naming system that provides addresses to web servers and web pages. 

 

Drop Shipping 

A type of eCommerce arrangement where the goods are directly shipped from the manufacturer to the retailer or customer. 

 

eBay 

An online auction service provided by a multi-national eCommerce corporation that facilitates the buying and selling process.

Similar to Amazon, seller’s pay a fee for listing products and a percentage of the sale.

Payments through this platform are usually made through PayPal. 

 

eCommerce 

Online retail; the process of selling products online and on mobile through shops, 3rd party marketplaces like Amazon & eBay, and other channels. 

 

eCommerce SEO 

Search Engine Optimization (SEO) services with strategies focused on eCommerce businesses. 

 

Email Marketing 

Engaging your audience with products and services promoted through email.

These email lists usually consist of users that have signed up or expressed an interest in the site or organization. 

 

Engagement Rate 

A metric that is used to measure how much a visitor gets engaged to a given piece of content or ad; it shows a percentage of the people who came to the site, noticed the ad or content and could engage with it.

Factors that influence the Engagement Rate are things such as comments, likes and shares. 

 

Event-Triggered Email 

An automated email message which is sent to the list of subscribers when a particular event occurs.

Triggered based emails have proven to be advantageous in email marketing as it makes the customer feel valued and helps in retaining them. 

 

Evergreen Content 

This is content that it timeless, sustainable and stays relevant and useful for months and years to come.  

 

Fulfilment 

A sequence of steps a company undertakes to process the order from the point of sale to the delivery of goods with customer satisfaction. 

 

Gateway 

An e commerce service provider that communicates with the seller’s Merchant Account Provider to authorize and process credit card payments online. 

 

Google 

The leading provider of search engines, Google uses an algorithm that gathers search results for keyword that users type into the search field and organizes them based on the best possible matches. 

 

Google AdWords 

An advertising service that allows business to set a budget that runs the promotions that you have written.

Ads are typically composed of SEO keywords. 

 

Google Analytics 

A free tool that links with your website.

It allows you to track traffic through your site and interactions with your funnels and goals.

Google Analytics provides insight about your website, which can be used to identify growth hacks. 

 

Google Keywords 

Trending words or phrases based on what users are searching for.

Keywords are often tracked and used throughout ads and other marketing strategies.

Keywords matching a search are displayed on the Search Engine Results Page (SERP).

 

HTML (Hyper Text Mark-Up Language) 

Commonly referred to as “the code” of a website, HTML is a language that designs a web page or application.

HTML can adjust layout, images, font, syntax or links throughout your page.

It can also be manipulated by the user so that the page function(s) behave in a specific way or to change the overall look.

 

Inbound Link 

A link on third-party websites that points to your website. In SEO terminology, it is also known as a Backlink.

Inbound links are vital for SEO as search engines consider such links as a sign that the content on that page is useful.

It determines the page rank on google, which influences the position of your website in the search engine. 

 

Infographics 

Also known as Information Graphics, infographics are graphical visual representations of information, data or knowledge intended to present data in an easily understandable format.  

 

Inventory 

Stock of goods or items in your business. It is the current quantity of products on the retailer’s hands, which is waiting to be sold.

It’s very important to keep track of inventory levels in order to make sure you are not selling goods which are not in stock.

This helps you to keep an eye on shrinkage and minimum order levels.

Inventory can be referred to as current asset on the balance sheet of any company. 

 

JavaScript 

An object-oriented computer programming language commonly used in web development for creating interactive effects within web browsers.

JavaScript is a scripting language where the source code is processed by the client’s web browser, rather than on the web server, meaning JavaScript function can run even after a webpage has been loaded and can be done without communicating with the server. 

 

Keyword 

Keywords or phrases that are used to trigger search results or describe content.

There are 2 ways in which these are used on the web: 

As search terms for search engines 

Words that identify the content of a website 

When a specific word is searched, the advertiser’s ad which uses said keyword automatically appears on top of the searched pages. 

 

Keyword Ranking 

Specifically, where your site ranks with a certain keyword on a search engine results page. 

 

Keyword Stuffing 

An SEO technique where a large number of keywords are loaded onto a web page to artificially increase the pages ranking in search results and drive higher volumes of traffic to the site.

Is considered web spam or an unethical practice. Using this method can cause the website to be banned or penalized, temporarily or permanently on major search engines.

 

Landing Page 

The first web page of a site which is advertised on the search engine that visitors arrive at after clicking the link on the results page.

This page contains data or information on the keywords searched and is usually considered as a deal page, because visitors make their decision as to whether they want to move on from the landing page.

 

Lead 

A marketing classification used to describe a potential organization or consumer who expresses interests in a business’s product or service.

Leads are gained through marketing efforts, such as advertisement, or purchased from third-party companies.

 

Listing Fee 

The amount of money that online trading sites or auctions charge for listing products on their site.

The Listing Fee will vary, depending on the value of the items being sold as well as the starting price of said items.

 

Logistics 

Management of goods & services or resources between the point of origin and the point of consumption to meet the requirements of customers and / or corporations.

This is a part of supply chain management where both physical and abstract items (such as food, materials, time and information) are managed.

 

Long Tail 

The practise of selling large volumes of products to smaller amount of people, as opposed to selling small amounts of products to many people.

The idea is to attract significant amounts of traffic by increasing the volume of products. 

 

Margin 

The difference between how much a retailer bought a product for and how much a retailer sold the same product for.

Also known as Profit Margin. 

 

Marketing 

Activities of a company that includes; advertising, selling and delivering products to customers.

This is one of the most crucial components of business management.

Companies look to target audiences by using media exposure, endorsements, slogans and logos.

It is a way to create, retain and satisfy the customer(s). 

 

Metrics 

A measurement that evaluates items such as website traffic, keyword rankings, revenue or referrals when dealing with SEO and analytics. 

 

Mobile Commerce 

The process of buying services and / or products on a mobile or wireless handheld device. 

 

Monthly Recurring Revenue (MRR) 

Also referred to as Predictable Revenue. An income that your business is liable to receive every month consistently.

This is a by-product of a subscription business, which implies billing will take place on a monthly basis.

The easiest way to calculate your MMR is to multiply the total number of paying users by the Average Revenue Per User (ARPU) 

 

Multi-Channel eCommerce 

The process of selling goods and services across multiple different devices and channels, including online and mobile.

 

Native Advertising 

A type of online advertising where online content is created for paid promotion of a brand on media site(s) but resembles the publication’s editorial content.

There is no use of traditional ad formats, such as banners, but includes content like blogs or infographics.

 

Net Promoter Score (NPS) 

A metric that measures the willingness of customers to recommend a company’s products or services to others; this determines customer loyalty.

 

News Feed 

Also known as a Web Feed, this is a service by which users are provided with frequent data consisting of news updates.

These are received by subscribers in XML Format as summaries or links about people on your friend’s list, as well as occasional advertisement. 

 

Niche 

Goods and / or services tailored towards a specialized industry, or a select product. 

 

No-Follow Link 

An element that instructs the search engine bots not to follow the link.

When a No-Follow Link is used, there is no boost in the Page Rank and does not help a page#s placement in the SERP’s.

The No-Follow Link is created with a HTML tag, which looks like this: 

<a href=”http://www.website.com/” rel=”nofollow”>Link Text</a> 

 

Off-Page Optimisation 

All measures taken external to the website to improve its position in search rankings.

Typical Off-Page Optimisation can include; creation of links on third-party sites; placement of keywords / webpage / website name in anchor text of links; generation of links on authoritative websites; creation of links on social media networks etc… 

 

Open Rate 

A percentage representation of the number of people on the email list that opened a particular email campaign.

The calculation for this is quite simple:

Open Rate = Emails Opened / Emails Sent.

For example, if 100 emails are sent and 25 are opened, that would give you an open rate of 25%. 

 

Order Fulfilment 

Reference to the steps involved in the process of delivering goods to end users, from the point of order.

The steps in this process are as follows;

Receiving Order

Inventory Storage

Order Processing

Shipping and Returns Processing. 

 

Organic Traffic 

Visitors that find your site as a result of unpaid search results. Organic Traffic is the opposite of Paid Traffic.

 

Outsource 

Hiring third party providers to handle aspects of your business on your behalf.

Outsourcing is common in ecommerce, on everything from web design to fulfilment.

 

Page Rank (PR) 

The measurement of where a page is ranking with search engines.

Pages with a higher Page Rank are closer to the top search result.

 

Partial Shipment 

A type of shipment in which the online store merchant ships only part of the products in a single order.

Using this distribution process means the order will be fulfilled in multiple deliveries.

 

Path Length 

How long (how many interactions) it took for your visitors to become customers.

This can be calculated and summarised for you in a Google Analytics Report.

 

Pay-Per-Click (PPC) Marketing 

An online advertising model where the advertiser pays an organization only when their advertisement is clicked on and the visitor is successfully directed to his website.

Payment Card Industry Compliance (PCI Compliance) 

A set of requirements that ensures a safe and secure environment for businesses which store, process and / or transmits credit card information. 

 

PayPal 

A leading payment processor preferred by a number of consumers.

Owned by eBay, PayPal can be an essential component of your ecommerce payment setup.

 

Point of Sale (POS) 

A software which enables the online store to accept transactions, process payments, add products, manage inventory and send receipts digitally.

 

Profit Margins 

A percentage of selling price turned into profit, used to measure how well a business can manage its costs.

The higher the profit margin, the better the company at controlling costs.

Profit Margin can be easily calculated as follows:

(Total Sales – Total Expenses) / Total Sales = Profit Margin.  

 

QR Code (Quick Response Code) 

A machine-readable two-dimensional barcode made up from a variety of black and white squares.

QR Codes are typically used for storing URL’s to provide easy and instant access to information using a smartphone device.

 

Qualified Lead 

A visitor that has shown interest in making a purchase on your site.

 

Recurring Payment 

A transaction in which the customer has agreed to pay on a prearranged schedule in return for regular goods / services.

This usually comes as a monthly payment plan.

For example, paying phone bills, gym memberships or magazine subscriptions.

 

Responsive Design 

A design technique that allows a customised viewing experience for different platforms.

For example, detecting the visitor’s screen size and orientation and change accordingly.

Using a Responsive Design will increase reach of your website to a large audience using a variety of devices.

The website will appear differently on smartphones, laptops and tablets to provide higher usability for each platform. 

 

Return on Investment (ROI) 

The gain or loss generated on an investment relative to the investment’s cost.

Usually shown as a percentage, ROI is often used for financial decisions; to compare a business’s profitability or to analyse the efficiency of different investments.

A business’s ROI can be calculated simply: (Net Profit / Cost of Investment) x 100.

 

Search Engine Optimization (SEO) 

A marketing process of improving an online website’s content to make it easier for search engine bots to index the website and potentially enhance its page rank.

 

Search Engine Results Page (SERP) 

The page that is generated by searching keywords on a search engine, listing relevant results.

 

Service Level Agreement (SLA) 

A contract signed between the company and the customer that details the services and/or goods expected from the provider and the standards that are required to be met.

This includes the quality, scope and nature of the services / goods, responsibilities and availabilities to be implemented, all of which are agreed between the company and the customer.  

 

Shopping Cart 

The virtual representation of a shopping cart, which lists the items the customer has “picked up” from an online store. 

 

Social Media 

The collection of online communication channels dedicated to social networking, forums, micro-blogging, social bookmarking etc… that facilitates the creation and sharing of ideas, information and other forms of expression.

Social Media allows individuals to interact with and converse over particular news articles, blog posts, advertisements and more.

The most commonly used forms of Social Media are; Facebook, Instagram, Pinterest, LinkedIn, Twitter and Vimeo. 

 

Social Proof 

The influence that the actions and attitudes of the people around us (both in life or online) have on our behaviour.

The idea that if other people are saying / doing something, then it must be correct.

Social Proof can be built in the form of reviews, testimonials and trust seals, which increase credibility and generate interest. 

 

Split Testing  

Testing multiple separate elements of your ecommerce business to verify which performs better.

For example, running ads on a variety of social media platforms to see which one(s) your audience uses most. 

 

Stock-Keeping Unit (SKU) 

An online store’s alphanumeric identification for each product and / or service that can be purchased. 

 

Third Party Payment Processor 

A company that handles company account payments from various channels such as credit or debit cards.

Possibly the most popular example of this is PayPal. 

 

Time Lag 

The summary of how long it took your website visitors to finally become customers.

Time Lag can be summarised in a Google Analytics report. 

 

Traffic 

The number of visitors coming to your site from a variety sources.

Higher numbers of traffic usually results in more custom. 

 

Transaction 

Purchasing an order from an online seller. 

 

Turnkey 

A software or packaged product which is built, installed and supplied by the manufacturer in its completed form.

I.e. it’s ready to operate / use. 

 

Unique User 

An individual that has visited a website for a given amount of time or that has received specific content, such as emails, ads and newsletters.

Companies track their unique users to determine how many people see their content within a given time period.

A Unique User is counted as a single visitor regardless of how many times they visit the site.

This is determined by cookies, unique IP addresses or user identification. 

 

Upselling 

A sales technique that persuades customer(s) to buy additional goods / services whilst making a purchase.

This strategy exposes the customer to other options that they may have not previously considered, with the intent of making a bigger sale.

For example, if you were to buy a burger at a fast-food restaurant, you would be asked if you would also like to buy fries and a drink for a smaller price than they would usually cost.

 

User Experience (UX) 

The visitors overall experience while using a product, service or system.

Specifically, in terms of how easy or pleasurable it is to use.

Techniques to improve your UX would be to use Responsive Design or to ensure your site runs quickly. 

 

User Interface (UI) 

The method by which the user and the computer exchange information and instructions.

User interface determines how commands are given to the computer and how information is displayed on the screen.

A UI is considered good if it proves itself as user. 

 

Viral Content 

Media material(s), such as articles, videos or images, that rapidly spread online through social sharing channels and website links.

Whether or not a particular content is “viral” can be calculated by how many likes, comments, shares, views clicks etc… it has.

This can be done with our Engagement Calculator.

 

Void 

A type of transaction that cancels a transaction that has not yet been completed. 

 

Wholesale 

The stage in the supply chain before retail.

Wholesale deals in bulk / large volumes.

You may be buying stock wholesale or selling wholesale to another trading party.

 

WordPress 

A free, open-source blogging platform used as a basis for creating ecommerce stores and a variety of other websites.

WordPress ties up with WooCommerce and others to provide ecommerce functionality through the WordPress platform. 

 

Web Analytics 

A set of strategic methodologies to collect, measure, analyse and report website data in order to determine the behaviour of website visitors and optimise the website itself. 

 

XML Sitemap 

A textually represented hierarchical model of a website’s content pages.

The list is provided with links to its counterpart sections of the website and are organised by topic in an XML format.