In Outward, there are primarily 6 types of damage that can be inflicted on both enemies and the player.
All of these damage types except Physical are considered "elemental", and there are certain buffs which can be applied to only these types. Protection applies only to Physical damage, while Barrier applies only to elemental damage types. In all other cases, physical behaves exactly the same as the elemental damage types.
There is also Raw damage, sometimes referred to by players as "true" damage. It cannot be resisted against or boosted with any type-specific buffs or "elemental" buffs.