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  • Writer's pictureWirya Hassan

E Commerce Definition

E commerce is a collective name for transactions that are handled digitally. For example, the purchase of a product in a web store.

E commerce has, strictly speaking, been in place since the 1970s when banks first started using a mutual computer network for the exchange of money. The term has become known to the masses by the

rise of online shopping on the worldwide web.

Often support activities are also seen as part of e commerce. Think of dealing with online payments, distribution and online marketing.

E commerce is a multi faceted activity and to grapple with the subject you need to familiarise yourself with its jargon. Below is a list of the most common terms used in connection with e commerce:

Affiliate program: the form of cooperation between the advertiser and the site owner. The site owner places advertising of goods, services or a link to a virtual store, and the advertiser pays a commission for each purchase of a visitor who came by the link.

Affiliates (partners): owners of sites participating in the affiliate program of the advertiser.

Affiliates: owners of sites participating in the advertiser's affiliate program.

Authentication: The process of identifying the party involved in the connection.

Authorization : permission to access resources or services.

Authorization of a plastic card : establishment of creditworthiness of a card. As a result of the authorization process, the issuer of the card authorizes the transaction (payment). This process confirms that the restrictions on the amount of payment for this card are not exceeded and reserves the specified amount.

B2B (business-to-business): e-commerce systems in which commercial entities act as subjects of sales and purchase processes. Such systems are usually used to organize the supply and marketing of finished products.

B2C (business-to-customer, business client): e-commerce systems in which a legal entity acts as a seller and a private (physical) person as a buyer.

B2E (business-to-employee): an intracorporate e-business system that allows to organize the work of company personnel and conduct joint business activities of employees, individual structures or units.

B2G (business-to-government): e-commerce systems where legal entities (enterprises, organizations :) on the one hand and state institutions on the other act as parties to business relations.

Banner: an advertising graphic block linked by a hyperlink to the advertiser's site.

Browser (World Wide Web Browser): A program that allows a user to read hypertext documents. The browser allows you to view the content of the nodes of the network

(or "pages") and move from one node to another.

C2C (Consumer-to-Consumer): e-commerce systems between various private (physical) entities. For example, an electronic auction, in which some individuals can put up for sale

goods and items intended for purchase by other individuals.

Certificate Authority: A company or organization that stores digital certificates. Accepts the public key from the user, checking his identity. After that, other users can contact the certification center to authenticate the public key of this user.

CGI (Common Gateway Interface): the standard for creating software modules. Usually CGI-

modules are used to create the software part of WWW-sites, for example, to work with a database or a system of demonstration of advertising banners.

Click: Clicking on an advertising banner or text link (click with the mouse button).

Cookie: data stored by Internet browsers on the user's computer. For example, individual settings.

CPC (cost-per-click) : the cost of a single click on an advertising banner.

CPM (cost-per-millennium) : the cost of thousands of banners. The main indicator of the cost of advertising.

CTR (click-through-ratio) : the ratio of the number of clicks on the banner to the total number of banner impressions. Usually expressed as a percentage and is one of the main ways to measure the effectiveness of banner advertising.

Cyberspace (Cyberspace) : a collection of information resources available through the global computer network Internet.

Database: An organized array of structured data.

Digital Certificate: an electronic document issued by a certification authority. Used to identify the company or user by checking its public key.

Digital signature : A digital code that identifies the sender of an electronic message. When signing electronic documents confirms the consent of its holder for the performance of a financial transaction and has the legal force of a handwritten signature.

Digital wallet: software that allows the client to safely make payments through the Internet.

DNS (Domain Naming Service): A network service that converts digital addresses to alphabetic addresses.

Domain Name: an Internet address that is issued through the InterNIC service that handles the registration of addresses.

Dot-com: this is any commercial site, Internet business (from .com - the last part of the address of most American sites).

E-advising (electronic consultations, meetings): on-line interaction on issues of law, taxation, establishment of firms, etc. For the implementation of using e-mail, telephone communication (сall-center), electronic conference systems, including Internet conferences.

E-auction (electronic auction): the sale of various goods at auction in the electronic business, when there is one seller and many buyers. Interested in a specific offer, customers transfer the fee to the seller and receive the desired product within a certain time.

E-billing: the mechanism of mutual settlements between the bank and the client, allowing you to receive and send paid invoices for services provided in real time.

E-business: the transformation of basic business processes using Internet technologies. E-business is business activity that uses the capabilities of global information networks to transform internal and external relationships to create profit.

E-cash (electronic cash): implemented as a smart card, which can be an electronic purse or electronic wallet that stores an electronic representation of cash. The smart card contains all the information necessary to authorize cash transactions in it, and is used for small settlements such as paying for travel in urban transport, buying newspapers, etc.

E-catalogue (electronic catalogue): an information system containing information about products and services for customers or business partners. Allows the exchange of additional

information between producers and buyers. Allows you to reduce costs for purchases and deliveries in organizations. The electronic catalog, as a rule, is an integral part of the electronic trading system.

E commerce (electronic commerce) : any form of a business transaction that is conducted using information networks.

E-community (electronic community): a kind of electronic trading platform. ETPs of this type bring together potential buyers and sellers on the basis of general professional interest. Communities provide the company with the necessary information containing industry news, research, market information, job listings, and also allow participants to communicate directly online or through a bulletin board.

E-consulting (electronic consulting): the type of e-business, which consists in the provision of remote consulting services. Examples are professional customer consultations by e-mail, providing information from information services, conducting various surveys via the Internet, etc.

EDI (Electronic Data Interchange): electronic exchange of business documents (purchase orders, invoices, etc.), between different computer programs in a single standardized


E-exchange (electronic exchange): the purchase and sale of various goods on the exchange in the electronic business, when there are many sellers and many buyers. Interested in a specific proposal, the customer, having won the contract, transfers the fee to the seller and receives the desired product within a certain time.

E-goverment: the transformation of all levels of government, from interdepartmental interaction to the interaction of the state and citizens, on the basis of new information

technologies (electronic means of processing, transferring and disseminating information, providing government agencies of all branches of power to all categories of citizens

by electronic means, informing about the work of state bodies.

E-intermediary: the form of electronic business, the main purpose of which is resale or intermediation, carried out through electronic means.

Electronic billing (E-billing): the mechanism of mutual settlements between the bank and the client, allowing to receive the issued and send paid invoices for the services rendered in real time.

Electronic business (E-business): the transformation of basic business processes using Internet technologies. E-business is business activity that uses the capabilities of global information networks to transform internal and external relationships to create profit.

Electronic Funds Transfer (ETF): e-commerce technology that allows you to transfer money from a bank account of one person or organization to another person's or organization's bank account. The term is also used to refer to the act of using this technology.

Electronic purses: a smart card, on the microchip of which is stored in digital form the cash that can be used to purchase a variety of goods and services.

E-mall (electronic shopping mall): a collection of several electronic stores operated by different vendors and distributing various products and services (the so-called horizontal market platform).

E-market, e-marketplace: virtual market space for conducting electronic business in the field of committing transactions and sales, providing information about goods, products and services, as well as supporting mutual communications between sellers and buyers.

E-marketing (electronic marketing) : conducting marketing on the basis of electronic technologies.

E-money (electronic money): non-cash funds, which are manipulated electronically.

Encryption: Encryption of data by performing a series of mathematical or logical transformations. The encrypted message can only be converted to the original form if there is a private key.

Enterprise resource planning (ERP) system: an information system focused on ensuring an agreed solution to the tasks of accounting, control, planning and management of the

company's production and financial resources. The solution of supply and marketing tasks in ERP systems, as a rule, reduces to accounting functions. At the same time, there is no mechanism for direct interaction with similar resource planning systems of suppliers and consumers.

E-procurement (electronic supply): covers all electronic forms of purchase and delivery of goods in the production cycle of the enterprise.

E-purses: A smart card, on the microchip of which is stored in digital form a cash sum that can be used to purchase a variety of goods and services. The smart card issuer ensures

safe transfer of funds between different electronic purses.

E-service (electronic service): all types of services and services provided by electronic means.

E-shop (e-shop): an electronic point of sale, which provides an opportunity to make purchases of necessary goods online and within the available assortment.

E-solutions (electronic solutions): a wide range of activities for obtaining information, processing it, supporting mutual communications and mapping processes related to

decision making.

E-supply chain: a chain, a network of suppliers operating within the e-business system.

E-taxes (electronic taxes): registration and payment of taxes through information networks. For example, systems that allow you to fill out and send online tax returns.

E-tender (electronic tender): holding an electronic business tender for the purchase of various goods, works and services, when there is one buyer and many sellers. Interested sellers sell their products and prices, and the buyer chooses the best offer (price, quality, etc.) from his point of view, transfers the fee to the seller and receives the desired product / service within a certain time.

E-wallet: software that allows the owner of a smart card to make online transactions, manage receipt of payments and store digital certificates.

Financial calculator: an option that allows you to calculate in real time the amount of income and repayments for various banking, investment and insurance products (tools), depending on individual conditions. For the potential buyer, the electronic intermediary is useful in the rational choice of a variety of products and the range of services and market suppliers, and for the seller - the ability to produce marketing analysis of the market and customer needs.

FTP (File Transfer Protocol): the file transfer protocol between the file server and the user's computer over the Internet.

Gateway: A program designed to connect two networks using different protocols, so that data exchange becomes possible between them.

Hacker: a specialist in computer technology, seeking to gain unauthorized access to systems with sensitive (confidential) information.

HTML (Hypertext Markup Language): alanguage for creating pages on the Internet in which hyperlinks, text, graphics, sound and video are combined. HTML consists of commands independent of the software that describe the structure of the Web page.

HTTP (HyperText Transfer Protocol): A protocol that defines the transfer of an HTML file from a server to a client via the Internet.

Hyperlink: text in an HTML document that refers to a link to other information on the network. In the text, hyperlinks are usually highlighted underlined.

Hypertext: A set of web pages that contain cross-references that allow the reader to navigate from one document to another using a browser program.

Internet bank: a bank that provides Internet banking services. an Internet bank can be a traditional bank that serves customers, including through the Internet, and a virtual bank.

Internet banking: a type of remote banking service that uses Internet capabilities.

Internet broker : a brokerage (investment) company offering internet trading services.

Internet Incubator : a venture investment model, whose goal is to accelerate the preparation and rapid market entry of Internet companies and their projects.

Internet trading : remote access to trading (investment) accounts via the Internet with the ability to perform transactions for the purchase / sale of shares and other stock


Internet: A worldwide network of networks that provides communications for sending e-mail messages, transferring files, connecting to other computers, and accessing

information in a variety of forms.

Intranet : A private network connected in a single unit using TCP / IP technology and usually connected to external networks, including the Internet, through a firewall

protection tool against unauthorized access.

IP (Internet Protocol) : a network layer protocol, on the basis of which the address space is organized and the information packets are routed over the network

IP-address : A digital address that identifies a computer connected to the network.

ISP (Internet Service Provider) : A company or organization that provides users with access to the Internet.

Local area network : A network that connects computers located up to 1000 meters from each other.

Mobile banking (m-banking): managing a bank account via a cellular phone or a personal digital assistant using Wireless Application Protocol technology.

Mobile commerce (mobile commerce): purchase or sale of goods and services using mobile communication devices - cell phones, PDA (personal digital assistant).

Mobile trading (m-trading): management of an investment account by means of a cellular phone or a portable computer (Personal Digital Assistant) using wireless access technology (Wireless Application Protocol).

Online banking: remote management of bank accounts via telephone (telebanking), personal computer and Internet (Internet banking) or portable devices (mobile banking).

Online trading (online trading / brokerage) : remote management of trading (investment) accounts by means of a personal computer and the Internet (Internet-trading) or portable devices (mobile trading).

Online trading / brokerage: remote management of trading (investment) accounts by means of a personal computer and the Internet (Internet-trading) or portable devices (mobile trading).

Packet: The data grouped for transmission over the information network. They usually consist of service information, information about the transmitted data and the data itself.

PDA (Personal Digital Assistant): a pocket or palmtop computer that combines the functions of a notebook and a mini computer.

PERL (Practical Extraction and Reporting Language): the language of system administration on which program modules are created.

POP (Post Office Protocol): the protocol for processing incoming e-mail messages.

Protocol: A set of rules that defines everything related to network operation.

Proxy Server: A server that acts as an intermediary between client computers and servers. Before transmitting data to the user, it checks to see if it has the right to access this information.

Purchasing card: A smart card designed for the business market that allows the company's employees to deal directly with suppliers and reduce overhead costs by getting rid of the

papers and the like required for the purchase order. Orders are accepted by phone, and the company's management receives detailed information about the costs of each employee, the supplier, etc.

Server : A computer (or program) that provides some services to clients-other computers (programs).

SET (Secure Electronic Transaction) : a standard that ensures the safe exchange of transactions through the Internet, using digital certification to verify the authenticity

that the entity carrying out the transaction is indeed the owner of this credit card.

Smart card : a plastic card with a built-in microchip. Money of the smart card holder is stored not in the bank account, but in electronic form directly on the chip of the

smart card.

SQL (Structured Query Language) : a language for managing databases.

SSL (Secure Socket Layer): protocol for authentication and cryptographic protection of communication channels operating on the basis of TCP / IP protocols. According to this

protocol, clients and servers can authenticate each other, and then exchange encrypted data. The key that decrypts encrypted data is itself encrypted and thus the possibility

for outsiders to read information is excluded.

Venture capital (risk capital): capital invested in projects with an increased level of risk.

Venture capitalist: A specialized firm (or an individual) engaged in investments with an increased level of risk.

Virtual bank: A bank that works exclusively with customers through the Internet, and unlike traditional banks that does not have a branch network

World Wide Web (WWW, W3) : a worldwide information network based on hypertext information representation - a set of pages (sites) and links to other pages (sites) and

executable program modules.

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