What is an Incoterm and why does it matter for e-commerce?

Incoterms are standardised trade rules from the International Chamber of Commerce defining buyer/seller responsibilities in international transactions. For e-commerce, DDP and DAP are the two key Incoterms. DDP means the seller handles everything including duties; DAP means the customer pays import charges on arrival. Choosing the right Incoterm directly impacts conversion, customer satisfaction, and return rates.