In this comprehensive Shopify glossary, we give you an A to Z of all the key terms you need to know when using this popular ecommerce solution to set up your online business.
An ‘abandoned cart’ refers to a situation where a potential customer adds items to their online shopping cart but exits the process without finalizing the purchase.
This is a crucial metric for Shopify business owners, as understanding the reasons behind cart abandonment can help improve the customer journey and increase sales.
Abandoned cart recovery
Abandoned cart recovery refers to the process of re-engaging customers who added items to their online shopping cart but left the website before completing their purchase. This is achieved through various marketing strategies like sending reminder emails or displaying retargeted ads. These strategies aim to prompt the customer to return to the website and complete their transaction.
In Shopify, abandoned cart recovery is facilitated through customizable automated emails that remind customers about their unfinished purchases. When a customer adds items to their cart and starts the checkout process but leaves without completing the purchase, Shopify keeps track of this. After a period of time specified by the store owner, Shopify sends an automated email to the customer with a link to their abandoned cart, reminding them to complete the purchase.
Add to cart
‘Add to cart’ is the process by which a customer selects an item they want to buy from an online store. Once a site visitor clicks the ‘Add to Cart’ button, the item is reserved for them in their personal shopping cart until they decide to complete the purchase or remove the item.
An API (Application Programming Interface) is a set of rules and protocols that allows different software applications to communicate and interact with each other.
The Shopify API allows for actions such as retrieving product information, updating inventory levels, processing orders, and synchronizing data between Shopify and other systems.
Apps are software applications designed to perform specific tasks on a computing platform. In Shopify, apps (both paid-for and free) can be added to extend the functionality of the platform. These apps cater for a wide range of use cases, including dropshipping, email marketing, blogging and more.
An app store is an online marketplace where merchants can discover and install a wide range of applications, plugins, and integrations to extend the functionality of their online stores.
Shopify’s app store provides over 8,000 free and paid apps, developed by both Shopify and third-party developers. These cater for various aspects of ecommerce such as marketing, sales, customer support, inventory management and more.
Average Order Value (AOV)
‘Average Order Value’ (AOV) is a key metric in ecommerce. It represents the average total of every order placed with a merchant over a certain period. Increasing AOV is a common strategy for maximizing revenue.
The ‘back end’ of a Shopify store refers to the administrative side where the merchant can control various business operations — i.e., inventory management, order fulfillment, refunds and more.
A blog is an online tool that lets individuals or businesses regularly publish articles, insights, and updates on various topics of interest. Shopify comes with a built-in blogging feature.
A blog can enhance SEO efforts by increasing website traffic, improving search engine rankings and fostering a sense of community and brand loyalty. Consequently many Shopify store owners post regularly about topics related to their business niche.
‘Bounce rate’ is a web analytics term that describes the percentage of visitors who enter a site and then leave (‘bounce’) rather than continuing to view other pages within the same site. A high bounce rate often indicates that the landing page is not effective in retaining visitors.
Shopify’s ‘Buy Button’ is a sales channel that lets you sell outside your Shopify store — for example on an external blog, website, social media presence or e-newsletter. In short, customers can buy products directly from a Buy Button without leaving the digital presence they’re currently on.
In the context of online shopping, a cart is a virtual basket where customers can store products they intend to buy. The cart keeps a record of the customers’ chosen items, allowing them to review, add, or remove items before proceeding to checkout.
The checkout is the final step in the ecommerce purchase process. Here, customers review their cart, enter shipping information, choose payment methods, apply discount codes and complete the purchase.
A ‘collection’ in Shopify is a group of products that are categorized together to make it easier for customers to find and browse them. Collections can be based on product type, season, sale items, etc.
‘Conversion rate’ refers to the percentage of website visitors who complete a desired action, like making a purchase, signing up for a newsletter or adding a product to a cart.
Cost of Goods Sold (COGS)
The Cost of Goods Sold, or COGS, represents the total cost directly involved in creating or acquiring the products a company sells during a specific period. This includes costs directly related to the product like the cost of raw materials and the labor costs for workers who make it.
In a Shopify store, COGS could include the purchase price of products you’re reselling; shipping costs you pay to get those products delivered to you; and any customs duties on them. It does not include indirect costs such as marketing expenses or office overhead.
COGS is important because it’s subtracted from sales revenue to calculate the company’s gross profit.
A CSV file is a simple text file that organizes data in a table-like structure, with values separated by commas (CSV stands for ‘comma separated values’).
In Shopify, CSV files are commonly used for bulk importing and exporting product and order data.
Customer Acquisition Cost (CAC)
‘Customer Acquisition Cost’ (CAC) refers to the total cost of acquiring a new customer. It includes expenses like advertising, promotions, sales expenses and any other costs associated with persuading a potential customer to buy a product.
A Shopify custom field lets store owners add additional data fields to their products, collections, orders, customers or pages. These fields are not included in Shopify’s default settings, but can be created using various apps or programming techniques. Custom fields can be used to capture or provide extra information — for example product specifications, file uploads or customer preferences.
A typical use of a custom field might be to give Shopify customers the option to upload or provide information for a personalized product (engraving details, dedications etc.).
The ‘dashboard’ is a graphical interface within the Shopify platform that provides users with an overview of their store’s performance. It displays key metrics like sales, orders and online store visitor data.
Discounts in Shopify allow store owners to offer their products at reduced prices; they can include a percentage off, a fixed amount off or free shipping. Discounts can be applied at checkout using discount codes or can be applied automatically.
A domain name is the unique address that identifies a website on the Internet. It’s typically composed of a chosen name followed by a domain extension such as .com or .org (for example, mygreatstore.com).
Domain names are important to Shopify store owners as they establish a professional online presence, enhance brand recognition and make it easier for customers to find and remember a particular store.
“Dropshipping” is a retail fulfillment method where a store doesn’t keep the products it sells in stock. Instead, when a store sells a product, it purchases the item from a third party and has it shipped directly to the customer.
Ecommerce (also referred to as ‘e-commerce’) is short for “electronic commerce.” It refers to the buying and selling of goods or services using the Internet, and the transfer of money and data to execute these transactions. Shopify is currently one of the leading ecommerce platforms.
Email marketing refers to the use of email to promote products or services, nurture relationships with potential customers, and engage with existing customers. Shopify integrates with various email marketing services to help store owners manage this strategy, and also provides its own email marketing product, ‘Shopify Email.’
The Facebook pixel is a snippet of code provided by Facebook that you can add to your website to track and measure various actions taken by visitors on it.
It allows Shopify store owners to gather valuable data on user behavior, optimize ad campaigns, and create targeted audiences for remarketing purposes.
Flipping a Shopify store refers to the process of purchasing an existing online store built on the Shopify platform, making improvements and optimizations that enhance its value and performance and then reselling it for a higher price.
Fulfillment is the process of completing an order. It involves picking and packing products, shipping them to customers and updating order status in your online store’s dashboard.
A ‘Shopify front end’ is everything the user interacts with directly when visiting a Shopify store — it refers to the way the store looks, how it responds to user interactions and how it processes payments.
GDPR (General Data Protection Regulation) compliance refers to adhering to the data protection and privacy regulations set forth by the European Union (EU). It is designed to ensure that businesses handle personal data of EU citizens with transparency, security and consent.
GDPR compliance involves implementing measures to protect user data, obtaining explicit consent for data collection and processing, providing individuals with control over their data, and notifying authorities of data breaches.
Making a Shopify store GDPR compliant typically involves use of a cookie consent banner that adequately captures consent before running cookies and providing legal notices regarding privacy policies, cookie use and data store.
A gift card is a type of prepaid debit card loaded with funds for future use. On Shopify, store owners can sell digital gift cards that customers can buy for themselves or others.
Gross profit is a financial metric that represents a company’s financial performance before operational expenses, interest and taxes are taken into account.
It’s calculated by subtracting the cost of goods sold (COGS), which includes all direct costs associated with producing or acquiring a product, from the total sales revenue.
HTML (HyperText Markup Language) is the standard language for creating web pages. It uses ‘tags’ — little pieces of code — to tell web browsers how to display a web page’s content. That includes things like text, images, tables and links.
Although Shopify provides pre-designed templates, having a good understanding of HTML can be useful, because it lets you make more bespoke changes to them.
HTML newsletters are visually-appealing emails that use HTML code to make use of design elements like colors, images and different fonts.
In a Shopify context, store owners can use HTML newsletters to announce new products, share discounts, or provide updates about their business (and to do so in an on-brand way). These attractive emails can increase customer engagement and drive traffic back to the Shopify store.
Shopify lets you create HTML emails via its ‘Shopify email’ app.
Inventory management involves overseeing and controlling the amount, location and status of the stock within a business. In Shopify, you can assign stock to particular locations; keep online and offline sales of it in sync; and get alerted with inventory levels are low.
Key Performance Indicator (KPI)
“Key Performance Indicator” (KPI) is a measurable value that demonstrates how effectively a company is achieving key business objectives. In Shopify ecommerce, KPIs typically include metrics like conversion rate, customer acquisition cost and average order value.
A landing page is a standalone web page, created specifically for a marketing or advertising campaign. It’s where a visitor ‘lands’ after clicking on an online advert, and its goal is usually to encourage a visitor to complete a very specific action (i.e., sign up to a mailing list or make a purchase).
‘Liquid’ is the open-source, Ruby-based template language used in Shopify themes. It is used to load dynamic content on storefronts and makes it easy for merchants to customize the appearance of their online stores.
‘Merchandising’ in an ecommerce context refers to the promotion of goods and/or services that are available for purchase. It includes the planning, development and presentation of product lines for identified target markets.
Metafields in Shopify are custom fields that you can use to add extra information to your products, collections, customers, orders, blogs and pages. They allow you to store and manage additional data that Shopify doesn’t handle by default, effectively extending the standard features of the platform. For example, you might use metafields to store extra product details, shipping information or custom content for your site.
Multichannel selling refers to the practice of selling your products on multiple platforms or channels. These channels can include your online store, a physical location, online marketplaces like Amazon and social media. Shopify gives you access to several sales channels by default, and you can add additional ones to through the use of third-party apps.
Navigation refers to the process by which users access different parts or pages of a website — usually via menu bars, search boxes and sitemaps.
Net profit, also known as net income or net earnings, is the amount of revenue remaining after all operating expenses have been deducted from a business’ total revenue.
In an online retail context like Shopify, net profit is calculated by subtracting costs such as cost of goods sold (COGS), shipping, marketing expenses, Shopify fees, and other operational costs from the gross revenue.
In the context of Shopify ecommerce, a niche refers to a specific, focused segment of a larger market — a specialized area of demand for a particular product or set of products.
For example, instead of selling general fitness equipment (a broad market), a niche Shopify store could focus on eco-friendly yoga equipment.
Niche markets are often less competitive than broader markets and allow businesses to target their marketing efforts more precisely, appealing directly to the specific needs, preferences and concerns of a more defined group of consumers.
“Order Management” refers to the administration of business processes related to orders for goods or services. On Shopify, this involves receiving, tracking, and fulfilling customer orders.
Page views is a term used in web analytics to represent the total number of pages a user or group of users visited. It’s a commonly used metric for tracking website traffic.
A payment gateway is a service that processes credit card payments for online and traditional brick and mortar stores. It acts as a middleman between merchants and the banks that issue customers’ credit cards.
Shopify supports 100+ payment gateways including well-known options like PayPal, Stripe, WorldPay and Apple Pay; it also lets you use its own built-in payment gateway, Shopify Payments (using the latter lets you avoid transaction fees).
Plugins are software components that add a specific feature to an existing computer program. On Shopify, plugins are better known as apps — a wide range of these are available from the Shopify app store. Shopify apps cater for a wide range of use cases, including dropshipping, email marketing, blogging and more.
Point of Sale (POS)
“Point of Sale” (POS) refers to the place where a retail transaction is completed. This can technically be anywhere, but is typically understood to be in a physical location like a retail store.
Shopify POS is a feature of the platform that allows you to sell products in a wide range of physical locations, including brick and mortar stores, pop-up shops, markets and events.
Video: what is a point of sale system?
Print on demand
Print on demand (POD) refers to a low-risk business model where products, such as clothing, accessories and wall art are created and fulfilled individually in response to customer orders. With POD, items are not pre-produced or stocked, but are instead manufactured and shipped on demand, typically using a digital printing process. This approach eliminates the need for inventory management and allows entrepreneurs to offer a wide variety of customizable products to their customers without any upfront costs.
Popular print on demand apps for Shopify include Printful and Printify.
A product description in Shopify is the detailed information provided about a specific product listed on a Shopify store. It outlines key features of the product, its benefits and its uses.
Product descriptions play a vital role in ecommerce by helping potential customers understand what a product is, what it does and why they should purchase it. Additionally, well-crafted product descriptions that include relevant keywords can significantly improve SEO, making the product page more likely to be found by search engine users.
A Shopify product feed is a file that contains all the information about the products that you sell on your store. It includes details like product title, description, images, prices and SKUs. This feed can be used to list your products on comparison shopping engines and other key sales channels, like Google Shopping and Facebook Marketplace.
In Shopify, a product option refers to the customizable choices available for a product. These options typically include attributes like size, color, or material.
Note that product options should not be confused with product variants (see below), which are combinations of particular product options. Taking the example of a shoe, the product options here might be color and material, with individual variants being a blue suede shoe, a blue leather shoe etc.
A product page in Shopify is the web page dedicated to a specific product that you’re selling. It provides detailed information about the product, such as its name, images, description, price and availability.
Product pages play a crucial role in the customer’s decision-making process, as they offer the information needed to decide whether or not to make a purchase. A well-crafted product page can also improve the SEO performance of your store, making your products easier to find in search engine results.
A product variant in Shopify is a specific combination of product options (size, color etc.). For example, one variant of a t-shirt product might be a “small, blue” t-shirt, while another variant might be a “large, red” one.
In other words, product options define the types of variations a product can have, while product variants are the individual versions of the product that combine these options.
Shopify allows you to create up to 100 variants for a single product, based on up to 3 different product options.
A quick view feature on an online store allows customers to preview product details directly from a product listing page without having to navigate to the individual product page.
When a customer hovers over a product image or clicks a quick view button, a pop-up window appears displaying key product information (including images, product description, price). A ‘buy now’ button can also be featured in this preview.
Adding a quick view feature in Shopify typically involves installing a third-party app, like Smartviewer or Qikify.
A refund is a return of money to a customer after they have returned goods or decided not to proceed with a purchase.
Responsive design refers to a design approach that makes sure a web page looks good on all devices (i.e., desktop computers, tablets, and phones). A responsive design will automatically adjust and adapt to any screen size.
All the free and paid-for Shopify themes that you’ll find in the official Shopify theme store are responsive in nature.
Retargeting is a digital marketing strategy that targets individuals who have previously interacted with your website, displaying ads that encourage them to return to your site and complete a purchase.
Once the user leaves your site without making a purchase, the cookie notifies your retargeting platform. Your platform can then serve retargeting ads to that user as they browse other websites, use social media or search the web.
Return on Investment (ROI)
Return on Investment (ROI) is a measure used to evaluate the efficiency or profitability of an investment. It is calculated by subtracting the cost of an investment from the gain from that investment, then dividing the result by the cost of the investment, and finally multiplying the outcome by 100 to get a percentage.
For Shopify store owners, ROI could relate to investments in advertising, redesigns, new software, and more.
A return policy is a set of guidelines and rules that a store establishes to outline the conditions and procedures for customers to return or exchange purchased products. It typically includes details such as the timeframe for returns, accepted reasons for returns, required proof of purchase, condition of the item for return and any associated fees or refund methods.
Sales channels are the platforms or marketplaces where you sell your products.
They can include your online store, physical stores, mobile apps, social media platforms, online marketplaces like Amazon and eBay and even wholesale. Using multiple sales channels can expand your reach, improve customer convenience and increase revenue.
Shopify lets you connect a large number of sales channels to your online store (either via built-in integrations or through use of third-party apps) and manage them all from a single dashboard.
Search Engine Optimization (SEO)
Search Engine Optimization (SEO) is the practice of improving a website’s visibility in organic (non-paid) search engine results. It involves a variety of strategies and techniques aimed at making a website more attractive to search engines.
SEO involves optimizing elements like site speed, architecture, content, and backlink profile to rank higher for certain keywords or phrases relevant to the site’s products, services or content, and Shopify has several built-in features to help with this process.
Shipping in e-commerce refers to the process of delivering a product to a customer after they’ve made an online purchase.
Shopify allows store owners to set up various shipping methods and rates (including free shipping, fixed rate shipping, price-based shipping, weight-based shipping and local pickup).
Shipping zones in Shopify define the geographical regions where you offer shipping services. You can create specific shipping zones based on countries, regions or custom-defined areas. Once done, you can assign different shipping rates, methods, and options to each zone.
Shop Pay is Shopify’s own accelerated checkout solution, designed to make online shopping faster and more convenient.
When customers use Shop Pay for the first time, they enter their email, shipping and billing information, and credit card details. Shop Pay then securely stores these details and auto-fills the information during future checkouts on any Shopify store that has Shop Pay enabled.
This significantly reduces the time and effort it takes to complete a purchase, leading to improved checkout speed, higher conversion rates, and a smoother shopping experience.
Shopify analytics refers to the analytics features contained within the Shopify platform. These provide data about your store’s sales, customers, and visitors.
Available reports in Shopify include financial reports, product analytics, acquisition reports, inventory reports and behavior reports.
Shopify Email is an email marketing tool that can be integrated directly into the Shopify platform, allowing merchants to build email lists, send newsletters and track email marketing campaigns. To use the service, the Shopify Email app must be installed first (via the Shopify app store).
Once installed, the app provides a range of customizable email templates that are designed to match the existing look of the user’s online store. Using Shopify Email, store owners can send branded emails to their customers to promote products, offer discounts or communicate news about their store. The service also offers automation features that let store owners trigger emails to be sent based on store visitor behaviour.
The Shopify Experts service is a curated network of experienced professionals (developers, designers and marketers) who offer specialized services to help merchants with various aspects of their Shopify stores. You can locate and hire one of these professionals by browsing the Shopify Experts website.
‘Shopify Flow’ is an automation tool offered by Shopify that allows merchants to create custom workflows and automate repetitive tasks within their ecommerce operations.
These workflows can streamline processes such as order fulfillment, inventory management, customer segmentation and marketing campaigns.
‘Shopify Payments’ is Shopify’s built-in payment gateway. It allows you to accept and manage payments from customers, including credit card transactions.
In Shopify, the advantage of using Shopify Payments rather than a third-party payment gateway is that if you do so, transaction fees are waived.
‘Shopify Plus‘ is a premium plan offered by Shopify, aimed at high-volume merchants and large businesses. It offers advanced features and customization options not available on other plans, plus access to a dedicated account manager.
‘Shopify Starter’ is a Shopify’s cheapest plan. It doesn’t let you build a fully-featured standalone store but instead allows you to sell products on existing websites or social media platforms (often via its ‘Buy Button’ feature).
A side hustle is a secondary job or freelance work, carried out in addition to a person’s primary full-time job; it provides an extra income stream, separate from one’s main salary.
The concept of a side hustle has become increasingly popular in recent years, due to the flexibility offered by the gig economy, remote working possibilities and the increased availability of ecommerce platforms that facilitate dropshipping, print on demand and general ecommerce projects.
SKU (Stock Keeping Unit)
An SKU, or Stock Keeping Unit, is a unique alphanumeric code that you assign to each product variant. SKUs can help you identify the exact size, color, or other variant of a product, making it easier to manage and organize your inventory, fulfill orders accurately, and analyze sales patterns.
SKUs are not visible to customers, but are essential for efficient behind-the-scenes operations of your Shopify store, especially as your product range grows (or if you end up selling across multiple sales channels).
SSL (Secure Sockets Layer)
‘SSL’ (Secure Sockets Layer) is a standard security technology for establishing an encrypted link between a server and a browser. Shopify provides an SSL certificate at no cost to all stores on their platform to ensure secure credit card transactions for stores.
Standard Operating Procedure (SOP)
A Standard Operating Procedure (SOP) is a set of step-by-step instructions that businesses create to help their employees carry out routine operations. They can cover a wide range of procedures, from daily operational tasks to safety procedures and emergency responses.
SOPs aim to achieve efficiency, quality output, and uniformity of performance while reducing miscommunication and potential failures. Essentially, they serve as a roadmap for the everyday tasks within a business, ensuring that all activities are performed consistently.
A storefront is the customer-facing part of a Shopify store. It’s where customers browse products, add them to their cart, and complete purchases.
“Tags” are searchable keywords associated with your products. Tags can help customers find your product when using your Shopify store’s search box, and you can also use them to categorize products.
In ecommerce, taxes refer to the charges levied on the sale of products or services based on applicable tax laws and regulations. When running a Shopify store, you may be required to collect and remit taxes to the appropriate tax authorities, such as sales tax, value-added tax (VAT) or goods and services tax (GST), depending on your jurisdiction and the location of your customers.
In Shopify, a template is a pre-designed layout that serves as the framework for a particular type web page. Different templates can be used for different types of pages, such as product pages, collections pages, and the homepage.
A Shopify theme is a pre-designed template that determines the appearance and functionality of an online store built on the Shopify platform. It provides a framework for the visual design, layout structure and features of the store, including elements like the header, footer, product listings, navigation menus and checkout process.
Shopify themes offer customization options, allowing merchants to tailor the look and feel of their store to align with their brand and create a unique online shopping experience for customers.
Third-party apps are applications built by developers other than Shopify that extend the functionality of your online store. They cover a range of use cases (everything from email marketing to dropshipping to SEO is catered for) and can be purchased from the Shopify app store.
A transaction refers to the process of a customer purchasing a product from your Shopify store. It involves the customer choosing a product, adding it to their cart and making a payment for it.
A transaction fee is a percentage charged by Shopify on each sale made on the platform (with the precise percentage depending on the subscription plan a merchant is on). This fee is separate from any credit card processing fees.
Merchants can avoid transaction fees by using Shopify Payments, Shopify’s integrated payment gateway, instead of a third-party one.
Upselling in ecommerce is a sales technique where you encourage a customer to buy a higher-end product, an upgrade or an additional item in order to make a more profitable sale.
This might involve showing customers a more expensive version of the product they’re viewing, suggesting add-ons or accessories that go well with the product or offering a discount if they spend over a certain amount. The goal is to increase the average order value and maximize revenue from each customer.
Upselling primarily benefits the seller through increased sales, but when done right, it can also enhance the customer’s experience by helping them discover better options or complementing their purchase in a way that adds value.
User Experience (UX)
In ecommerce, User Experience (UX) refers to the overall experience and satisfaction that customers have when interacting with an online store. It encompasses the ease of navigation, intuitive design, clear product information, smooth checkout process and personalized recommendations.
A seamless and positive UX is crucial because it directly impacts customer engagement, conversion rates and customer retention. A well-designed and user-friendly Shopify site enhances trust, encourages repeat purchases, and fosters brand loyalty.
A variant is a version of a product that differs in some way from other versions, such as by color, size, or other attributes. Shopify allows for 100 variants per product.
VAT (Value Added Tax) is a consumption tax added to the price of goods and services at each stage of production or distribution. It is a mandatory tax in many countries and regions.
As a Shopify store owner, you are responsible for charging and collecting VAT from customers, and then remitting it to the relevant tax authorities. Failure to comply with VAT regulations can result in penalties or legal consequences.
Wholesale refers to the selling of goods in large quantities to be retailed by others. Shopify offers several features to support wholesale businesses, the key one being the option to set up a separate, password-protected wholesale store.
Widgets are small applications that provide a specific function or access to a service. In Shopify, widgets can be used to provide features like chat support, social media integration, or promotional banners.
A wish list is a feature that allows customers to create personalized collections of products they want to buy later. It helps customers save items that they find interesting and gives them the option to buy them at a later date.
“Workflow” in the context of Shopify refers to the sequence of industrial, administrative, or other processes through which a piece of work passes from initiation to completion.
Shopify apps like Shopify Flow allow merchants to create custom, automated workflows.