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Violet's Ecommerce Glossary

Your complete guide to the terms and ideas that will define the future of ecommerce

Below is Violet’s living ecommerce glossary: a set of key terms and definitions that ground the future of ecommerce in a common understanding and a shared vision.

Since our founding, we at Violet have seen ourselves as more than just product builders. With our API, we're redefining the future of online purchases. By opening up new terrains in ecommerce more broadly, our team has been pushed to clarify the way we talk about digital commerce, and the key stakeholders, technologies, and processes that drive it. In some cases that has meant crystalizing or refining existing terminology, and in others it’s meant creating our own taxonomy. 

For us, this taxonomy isn’t just a nice-to-have: it’s part of how we bring our vision to life. Clarity is one of our core values. As leaders in this space we believe it’s important to maintain and promote consistent terms so we can always be on the same page as our merchant, channel, and platform partners across the digital commerce landscape.

Because the terms of ecommerce are ever-evolving, we plan to update this page periodically to reflect developments in the industry. 


Affiliate marketing and payout

Affiliate marketing is a monetization model in which an affiliate channel partner–typically an online publisher or product aggregator like RakutenRakutenRaRakuten or Commission Junction–promotes a product or service by another retailer or advertiser in exchange for a commission. The affiliate partner receives a payout when their promotion results in sales or other desirable outcomes for the retailer, like qualified leads, free-trial users, clicks to a website, or downloads for an app. Currently, affiliate marketing requires the affiliate channel to send traffic off of their site to transact (also known as click out), resulting in tracking challenges, a less integrated user experience for the shopper, and lower conversion rates.

API

An application programming interface, or API, enables companies to open up their applications’ data and functionality to external third-party developers, business partners, and internal departments within their companies. This allows services and products to communicate with each other and leverage each other’s data and functionality through a documented interface in a secure, predetermined fashion.

Application or App

Within Violet, a channel uses our tool by creating their own 'app.’ This is different but connected to an application that the channel may offer to users on a host of platforms (mobile, desktop, web, AR, VR, messaging, etc). In the Violet API, a channel’s app, along with their app ID and access keys, is what allows them to connect to our system and use our API.

‍Cart

Like a physical shopping cart, an online cart is the software object that “contains” or tracks the products and product details of whatever the customer intends to buy at checkout. For merchants, online carts are a critical piece of infrastructure because they connect the customer’s intent to buy with the merchant’s backend data. As it turns out, streamlining that connection so that all the correct information goes to the right places can be quite challenging, because it requires syncing a merchant’s product availability and a customer’s purchase intentions in real time.  

‍Channel

A channel is any online experience. While channels today are constantly evolving, they generally fall into three categories: 

- Platforms: where users generate and monetize content

- Publishers: channels who own their own content on a given area of expertise or focus

- Emerging digital experiences: emerging channel forms like apps or mobile games

Regardless of their type, to be valuable to merchants, channels must attract and engage audiences. By aggregating potential customers, channels today offer merchants and shoppers the fastest, most seamless way to find each other.

‍Checkout

If the cart is the software object that contains what a customer intends to buy from a merchant, checkout refers to the series of software objects that reconcile all the other variables merchants need to fulfill the order. These include the products’ stock keeping units (SKUs), shipping method, customer email address, shipping address, payment method, and tax calculation (in a globalized marketplace that last one is pretty complicated). The complexity of online checkout is so cumbersome that it is one of the main obstacles to creating a click-out-free checkout today. Very few channels have the resources or infrastructure to reconcile all of the information needed for the items in a customer’s cart to get to their door or inbox.

Click out

Click out is used to describe the current online shopping experience in which customers can discover products across a wide variety of channels, but typically have to click out to another site to purchase them. Click out introduces headaches for customers, channels, and merchants alike by interrupting the shopping experience, and introducing extra steps and additional opportunities for error between when a customer adds the product to their cart and sees the order confirmation in their inbox.

Commission

Commission is a share of sale that’s given to other parties that facilitate that sale, frequently people involved in sales and marketing departments. Commission is often calculated as a percentage of the value of a sale. The rate typically correlates to the incremental unit economics of the conversion of an individual sale, i.e. a higher price and higher margin on each sale results in higher commission rates. As an example, cosmetics products, which typically have 50% or higher margin on each sale, often give out much higher commissions than household goods like paper towels.

Connection

At Violet, we use the word connection very deliberately to mean a server-to-server connection between a merchant’s backend and a channel’s application. The merchant can be on a standard ecommerce platform, an enterprise platform, or on a custom system. In all cases, the connection constitutes direct access to the relevant operations needed to support complete channel transactions at the edge.

‍Creator

Creators are individuals or small groups of individuals who create original, digital content that they monetize. This cohort spans content creators, curators, and community builders including social media influencers, bloggers, and videographers. Because creators are often supported directly by their audiences, the vast majority rely on user-generated platforms (UCGs) like Instagram, TikTok, Youtube, etc., to monetize their content and find and grow their audiences.

Today, creators are increasingly assuming a role akin to a traditional retailer, aggregating and recommending deals and products from a variety of merchants. As more creators start to monetize through product sponsorships and recommendations, they’re finding UCG platforms have not all kept up with the breadth of monetization opportunities creators want or need. The goal of Violet’s API is to support those platforms with the infrastructure they and other channels need to better support their creators and merchant partners.

Ecommerce platform

In most brick and mortar stores, merchants have both a store front and a back room or warehouse for products, packaging, and shipping. For online merchants, ecommerce platforms serve as the digital, online equivalent to the back room or warehouse. Instead of physical objects, the ecommerce platform holds, tracks, and manages a merchant’s data, which can often be quite extensive and complex. By offering a standardized backend for online merchants, ecommerce platforms make it a lot easier and more accessible to stand up an online store front (usually a website). It’s the separation of the online backend (data and inventory management) from the online frontend (online website, store, or app) that has launched the age of headless commerce.

Headless, headless commerce, and headless ecommerce platforms

The word ‘headless’ has been making the rounds lately, and in its proliferation has lost some of the nuance that we find essential to understanding our role in the future of ecommerce. When people use the phrase “headless,” we’ve found they are usually referring to one of three different but related ideas:

 -  Headless: As a general concept, headless means to be without a frontend. Violet’s API is headless because there’s no Violet storefront or platform we offer to merchants. But we are not a headless ecommerce platform. Instead, we’re an API that connects channels, ecommerce platforms, and merchants to one another.

-  Headless commerce: Headless commerce describes the decoupling of a merchant’s backend (inventory, taxes, order fulfillment, packaging, shipping, etc.) from their frontend (website, app, brick and mortar storefront). This decoupling is significant because it allows virtually any merchant to sell across a wide variety of channels (see omnichannel). As online channels multiply in number and type, the merchants who attract and retain customers will be the ones who can design flexible storefronts, landing pages, and product pages across online channels, and who are not limited to selling exclusively within a single website or marketplace.

-  Headless ecommerce platform: A headless ecommerce platform describes the growing group of ecommerce companies who focus specifically on helping merchants build omnichannel sales by providing a comprehensive, fast, and elastic backend database that can connect with any frontend store or site. Whereas ecommerce platforms like Shopify offer both the merchant’s frontend store and the backend infrastructure, headless ecommerce platforms like Swell or Fabric all offer a more flexible backend totally independent of whatever website or online channel their merchants choose for reaching customers.

In the past five years we’ve seen a slew of innovative products and services directed at helping merchants go headless (like some of those mentioned above). What we haven’t seen, and what we do, is make it possible for the checkout process to take place anywhere, regardless of the ecommerce platform a merchant may use, on whatever channel the customer has found their product. Our API expands the potential of omnichannel merchants to reach customers through infinite endpoints, and allows channels to become a purchase point for virtually any merchant with a single API.

Integration

Broadly, integration is the process of bringing two systems into sync with each other in an automated way. Merchants run their business on ecommerce platforms, and channels need to integrate their business, operations, and systems with those ecommerce platforms in order to move in lock step as an extension of a merchant’s storefront. This requires technical integration, in which the functions and capabilities of the ecommerce platform are mirrored across the board, for the channel to operate smoothly. Integration is the way by which a 'connection' is created.

At Violet, we aggregate many platform integrations into a single API and normalize the data across each.


‍Marketplace

A marketplace is a system in which multiple merchants can sell their products to customers. Marketplaces help customers by aggregating and centralizing supply, and they help merchants by aggregating customers and centralizing demand. Brick and mortar grocery stores, Walmart, and Amazon are all marketplaces as they aggregate products from many sellers for aggregated audiences of customers.

‍Merchant

A merchant, commonly referred to as a brand or store, is any company or party who holds product inventory and completes order fulfillment. Merchants typically market and sell products to customers. For the purposes of our definition merchants are not third party logistics (3PL) companies just offering order fulfillment logistics.

A merchant’s “products” do not have to be physical: they can be concert tickets, IRL services, bookkeeping, an NFT, or an online game. Unlike historic channel/merchant dichotomies, online merchants today can be both a brand that sells direct-to-consumer, and a multi-brand retailer like Walmart or Sephora. When selling online, merchants typically use an ecommerce platform integrated with their website, either that they’ve bought off-the-shelf (i.e. Shopify or WooCommerce) or a custom one they've built themselves (i.e. Nike or H&M).

‍Omnichannel

Omnichannel describes a merchant’s ability to sell and connect with customers across multiple online and offline channels in tandem. Omnichannel retail (or omnichannel commerce) is a multichannel approach to a customer relationship that focuses on providing a seamless experience whether the customer is shopping online from a mobile device, a laptop, or in a brick-and-mortar store. This includes but is not limited to new models like buy-online-return-in-store and other analog/digital hybrids.

‍Order

Orders are contracts between the purchaser and the merchant, in which the purchaser agrees to pay in exchange for some good or collection of goods (be they products or services) from the merchant.

‍Order writeback

In general computing a _writeback_ describes an operation in which data temporarily stored in one location is written back into permanent data storage in a different location. In the case of ecommerce, order writeback describes when information about an order–including product SKU, quantity, delivery address, billing information, shipping information, etc.–that is temporarily stored in an external cart is written back natively into the merchant’s ecommerce platform.

Among other things, Violet’s API allows orders made within channels to perform order writeback directly to a merchant’s ecommerce platform. This means the merchant immediately has all the information they need to fulfill a customer’s order, even though the order originated outside of their website or app. Any order processed through order writeback is handled on the backend as if it were placed directly on  the merchant’s website, rendering the external order functionally identical to an order placed on the merchant’s own site.

‍Product detail page (PDP)

A product detail page is the presentation of a specific product in view. The details displayed often include size(s), color(s), price(s), shipping information, out-of-stock notifications, reviews, and other relevant information customers may want to know before making a purchase. Typically this information is presented alongside an actual photo and/or video of the item with an “add to cart” button, and is only available on the merchant’s ecommerce platform. Violet provides all the data necessary for a channel to create a PDP for a merchant’s product without scraping, so shoppers can browse and buy directly without having to click out to the merchant’s site.

‍Product

A product is any good for sale by a merchant that requires inventory to be tracked and orders to be physically or digitally delivered to customers after sales are made. This includes downloadable digital goods, templates, online courses, and other media that must be purchased for consumption or licensed for use. It can even include donations to nonprofits, in which the nonprofit is the merchant and donors are the customers.

‍Scraping

Web scraping is the process of collecting structured web data in an automated fashion but without a direct connection to a system's backend. It’s also called web data extraction. While web scraping can be used for any number of purposes–price monitoring, news monitoring, and market research among others–it’s also currently the way many if not most channels get information about merchants’ products that they may advertise, sell, or link to on their site.

The central issue is that scraping can only happen periodically, at its fastest every 30 days. This is an issue in ecommerce because both customers’ carts and merchants’ inventories are quite dynamic, sometimes changing several times in the span of a minute. As a result, scraping fails to provide the most essential information that drives a successful online transaction, like accurate product specs and inventory numbers, tax rates, and shipping information.

To get that kind of dynamic information in real-time with no latency or inaccuracy, you need an integrated API, and Violet’s currently the only one on the market who can offer that scrape-free cart and checkout.

‍Unified commerce API

The broader term “unified API” refers to an API that connects multiple backend systems with a single integration instead of several. Companies like Plaid have created unified APIs for banking, Finch has created one for HR. A unified commerce API is the specific vision that we at Violet have been pursuing for nearly five years. Our API allows channels of any kind (gaming apps, online publishers, etc.) to connect directly to a brand or retailer's ecommerce backend without the need for expensive and complex integrations. This new kind of API enables any channel to launch its own integrated shopping and checkout experience, connected to its own network of merchants. For shoppers, this means a seamless checkout experience from anywhere, and for merchants it means multiplying the ways they can reach potential customers in ways that are targeted, authentic, and contextually relevant (and without expensive ads).

For us, the distinction between unified and universal is really important. Violet is about integrating, not dominating. We’re a unified API–not a universal API–because the goal is not for us to be at the center of headless ecommerce, but for us to provide the circuitry so that innovators and artists can imagine and build on top of our infrastructure.

‍Violet Connect

Similar to Plaid Link, Violet Connect is a tool we provide to channels who don’t want to build their own authentication mechanism to connect to each individual merchant. Within our unified commerce app, the Violet Connect authentication layer is what allows a channel to connect directly with a merchant’s store, and can be set up in as little as 90 seconds with no engineering required.

Webhooks

A webook refers to a subscription method that notifies one system about updates that happen in an external system. In ecommerce, webhooks are available from ecommerce platforms to provide updates to product data, order data, shipping & fulfillment, returns, or any other relevant changes to the database of products for external API consumers.

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10.4.2022
The Complete Guide to Headless Commerce