Online Business: key terms, formulas and examples
Online business sells through websites and marketplaces. Landing pages, SEO, ads and checkout design drive conversion, and cybersecurity protects customers.
Example
Simplifying checkout recovers abandoned carts.
Takeaway
Test your funnel, protect data and use two-factor authentication.
Key terms
- E-commerce
- Buying and selling goods or services online.
- Cybersecurity
- Protecting systems and data from digital attacks.
- Automation
- Using technology to do tasks without manual work.
- Minimum viable product
- The simplest version of a product that lets you test an idea.
- Landing page
- A web page built to turn visitors into leads or buyers.
- Cloud computing
- Renting computing power and storage over the internet instead of owning servers.
- Digital marketing
- Promoting products through online channels.
- Pay-per-click
- Advertising where you pay each time someone clicks.
- Chatbot
- A program that chats with customers automatically.
- Cart abandonment
- Shoppers who add items to a cart but do not buy.
- Marketplace
- An online platform where many sellers meet buyers.
- Two-factor authentication
- An extra login step that proves who you are.
- Mobile commerce
- Buying through phones.
- Digital payment
- Paying electronically instead of with cash.
- Cookie
- A small file that remembers a user's visit.
Formulas
Conversion rateC ÷ V × 100
Click-through rate (CTR)C ÷ I × 100
Cost per click (CPC)S ÷ C
Cost per lead (CPL)S ÷ L
Cost per thousand views (CPM)S ÷ I × 1000
Break-even ROAS100 ÷ m
Viral coefficienti × c
Conversion rateC ÷ V × 100
Return on ad spendR ÷ A
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