20 mobile commerce terms you may not know, but probably should

Are you well-versed in mobile commerce? If not, here are 20 terms explained to help you on your sweet merry way. 

Mobile commerce is growing and is estimated to reach $142 billion this year compared to $115 billion in 2015, according to Forrester. That’s right – it’s not going anywhere anytime soon.

To make sure that you know what you’re talking about, we have gathered together some of the more popular terms, allowing  you to look like an “m-com” guru in front of all of your marketing chums. (We’re nice like that!) 

In alphabetical order (with the exception of the first):

1. Mobile commerce/ m-commerce/ m-com

Whatever you prefer to call it, m-commerce is used to describe consumers’ activities around initiating or completing online electronic commerce transactions via their wireless devices, such as laptops, tablets, mobile phones, or smartwatches.

2. API

The term is short for application program interface. In simple English, API serves as a key for accessing a network’s data. Many social networks – such as Facebook, Pinterest, and Instagram – have offered marketing APIs. 

3. Authentication

Authentication is a security mechanism that verifies an individual’s or an entity’s identity, or confirms the level of authority of that person or organization.


4. Cloud-based payments or host card emulation

This payment technology stores payment credentials in the cloud. Both Visa and MasterCard have been conducting host card emulation supported mobile payment services.

5. Closed-loop card or application

A credit card, gift card, or an app that can only be used to purchase from a single brand, such as Starbucks app or Macy’s gift cards. In comparison, open-loop cards like Visa can be used almost anywhere.

6. Contactless

A range of wireless technologies with short range that enables payment transactions via chips embedded in payment cards, tags, key fobs and mobile devices.

7. Digital wallet

A way of storing different types of personal data, such as bank accounts and credit card information, on mobile or other electronic devices to enable secure electronic commerce transactions.

8. Dongle

A small piece of hardware that can be plugged into a computer, without which a specific software program cannot run. In mobile, it is referred to as a magnetic stripe card reader, such as Square.


9. Encryption (on mobile)

The practice of turning data into a format that cannot be understood by unauthorized users. An easy fix for the problem of data breaching when mobile phones or tablets are lost or stolen. 

10. Factoring

A merchant that can process sales through his or her account, on behalf of another merchant.

11. Geo-fence

Software or apps that set up a virtual perimeter. These programs will send administrators alerts when mobile devices or other physical objects enter or exit an established geo-fenced area.

12. Geo location

The ability to identify the real world, geographic location of an object by detecting radar signals emitted from mobile phones or Internet-connected computer terminals.

13. Loyalty program

Marketing efforts that encourage and reward repeat buying behavior, and is usually mutually beneficial for both the company and consumers.

14. Merchant app

Merchant apps allow retailers to accept payments via a customer’s mobile device.

15. Near field communication (NFC)

A technology that allows different mobile devices to communicate with each other, as long as they have an NFC tag and are within a few centimeters of each other.

payment gateaway

16. Payment gateway

An e-commerce application service that empowers merchants to accept credit cards and electronic check.

17. Point of sale (POS)

The time and place a sale takes place. POS also refers to the devices used to transmit the transaction, such as card readers connected to smartphone apps.

18. Tender steering

When a retailer offers consumers incentives that encourage the use of a particular card payment method. 

19. Tokenization

Tokenization is a data security process that involves replacing sensitive data with a unique identifier that has no exploitable value. It is one of the major practices to make cloud-based mobile payment transactions.

 20. Walled garden

An environment that controls a user’s access to apps, content, and other forms of media

Related reading

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