Domain
A domain is the name of your website, the part people type in the browser, like yourshop.com.
In a simple example
Your shop is called Sweet Crumbs, so you buy sweetcrumbs.com. Anyone who types it reaches your site.
Why it matters to you
A good short name is easy to remember and share, and it is yours for as long as you keep paying the yearly fee.
Do not confuse with
A domain is only the name. Hosting is the place where the files live.