Today we have the 4th and final post in my online business terminology series – eCommerce.
In the 3 previous weeks we’ve covered:
By eCommerce terminology I mean terms used when you have your own website/online shop and shopping cart.
While many of these terms may seem very basic for experienced online traders I’m sure that newbies will find my explanations valuable, especially if you haven’t started an online shop and just planning on doing so in the near future (if you have just purchased my eCommerce Magnates course for example).
So without further ado, let’s get started with the most common eCommerce terms that every online seller should know about!
Shopping Cart – this is the software that you use to build & manage your online shop. Without a shopping cart you really can’t build a fully functional online shop. A shopping cart will provide your store front design (your website/product pages etc.) as well as your back-end admin infrastructure where you manage all settings, process orders and do many more tasks.
There are two major types of shopping carts:
- Hosted carts (like Big Commerce) where your shop is hosted on the shopping cart company’s servers.
- Self hosted carts (like Open Cart) where you host the shop on your own server space.
I strongly recommend that you use a hosted cart instead of a self hosted one, especially if you’re new to all this. With self hosted carts there is a lot of extra work involved and they are in general more complicated and buggy compared to hosted carts.
Payment Processor – company that provides payment processing facilities. By payment processing I mean the process when customers enter their credit card details into your checkout page and then their card gets charged.
Merchant Account – financial institution where the money you charge customers is held and then transferred to your bank account. There are many companies that offer both Merchant Accounts and Payment processing solutions in one place to make the whole set-up and managing of transactions even easier (a classic example would be PayPal – offering your payment processor and merchant account services in one place). [Read more…]