Glossary of Ecommerce Terms (For Founders Who Hate Jargon)

Ecommerce can be full of technical terms, acronyms and vague buzzwords. But if you’re a founder trying to make smart decisions about growth, tech or marketing, you need clarity – not complexity.

This glossary skips the corporate-speak and cuts straight to the point. Whether you're briefing your agency, onboarding a new hire, or just tired of Googling acronyms mid-meeting, this is for you.

A–F

A/B Testing
Running two versions of a page or element to see which performs better. Used to optimise for conversion or engagement.

AOV (Average Order Value)
How much a customer spends, on average, per order. Total revenue ÷ number of orders.

Attribution
The method used to credit a channel (like email or ads) for a sale. Can be first-click, last-click or algorithmic.

Bounce Rate
The percentage of visitors who leave after viewing only one page. High bounce rates can suggest poor targeting or UX.

CAC (Customer Acquisition Cost)
How much you spend to get a new customer. Total marketing spend ÷ number of new customers.

CRO (Conversion Rate Optimisation)
The process of improving your site to turn more visitors into customers. Often includes A/B testing, UX improvements and copy tweaks.

CLTV (Customer Lifetime Value)
How much a customer is expected to spend over their entire relationship with your brand. Helps guide acquisition spend.

CTR (Click-Through Rate)
The percentage of users who clicked on a specific link or ad. Useful for measuring email, ad or CTA performance.

DTC (Direct to Consumer)
A brand that sells directly to customers, without going through wholesalers or third-party retailers.

Engagement Rate
A measure of how actively users interact with content – likes, clicks, comments, or time on page.

Fulfilment
The process of packaging and shipping a customer’s order. Can be in-house or outsourced to a 3PL.

G–N

Gross Margin
Revenue minus cost of goods sold (COGS). Expressed as a percentage. A key measure of profitability.

Landing Page
A standalone page designed to convert visitors – usually from ads or email – into customers or leads.

LTV:CAC Ratio
A comparison of customer value vs cost to acquire them. Most healthy brands aim for 3:1 or better.

Merchandising
How products are displayed and organised on your site – including homepage, collections, and recommendations.

NPS (Net Promoter Score)
A customer loyalty metric based on the question: ‘How likely are you to recommend us?’ Scored from -100 to 100.

O–Z

PDP (Product Detail Page)
The page on your site that shows a single product. Includes images, descriptions, reviews and purchase options.

Retention Rate
The percentage of customers who come back and buy again. A strong signal of brand health and product-market fit.

ROAS (Return on Ad Spend)
Revenue earned for every dollar spent on ads. $4 return on $1 spend = 4.0x ROAS.

SEO (Search Engine Optimisation)
Optimising your site content so it ranks higher in search results – without paying for ads.

Shopify Plus
The enterprise-level version of Shopify. Offers more customisation, automation and support than standard Shopify.

SKU (Stock Keeping Unit)
A unique identifier for a product variant – used for inventory management.

Subscription Churn
The rate at which subscribers cancel. Lower churn means more predictable revenue.

UGC (User-Generated Content)
Photos, reviews or videos created by your customers. Often used in marketing and on product pages.

Upsell
Encouraging a customer to buy a more expensive version of a product, or add a complementary product.

UX (User Experience)
How easy, intuitive and satisfying your website is to use. Strong UX leads to better conversion and retention.

Final Word

You do not need to know every acronym to be a great founder – but having a plain-English cheat sheet helps you move faster, make better decisions and hold your partners accountable.

Feel free to bookmark this or share it with your team. If you ever feel like your agency or dev team is speaking a different language, we’re happy to translate.

Want a version of this tailored to your vertical or tech stack? Just ask.