Ecommerce Glossary

Advertising Cost of Sale

ACoS is the percentage of attributed ad sales spent on advertising. A lower ACoS means your ads are generating revenue more efficiently.

Amazon Standard Identification Number

An ASIN is a unique 10-character identifier assigned to every product in Amazon's catalog. It is the fundamental unit of everything on the platform.

Average Order Value

AOV is the average amount spent per transaction. Raising AOV grows revenue without needing more customers.

Best Seller Rank

BSR is Amazon's ranking of how well a product sells within its category, updated hourly. A lower number means more sales.

The Buy Box is the 'Add to Cart' button on an Amazon listing. Winning it is critical — over 80% of Amazon's sales go through the Buy Box seller.

A bundle is two or more products sold together as a single unit, typically at a slight discount. Bundles raise AOV and can create a unique listing that avoids direct price comparison.

Click-Through Rate

CTR is the percentage of people who see your ad or listing and click on it. A higher CTR means your title, image, and price are compelling enough to earn the click.

Conversion rate is the percentage of visitors who complete a purchase. It is the highest-leverage metric on any listing — doubling it doubles revenue from the same traffic.

Cost of Goods Sold

COGS is the direct cost of producing or purchasing the products you sell. It is the foundation of every profitability calculation in ecommerce.

Demand-Side Platform

Amazon DSP is a programmatic advertising platform that lets sellers and brands buy display and video ad inventory both on and off Amazon, targeting audiences based on Amazon's purchase data.

Direct-to-Consumer

DTC is a business model where brands sell directly to end customers — typically via their own website — cutting out retailers, distributors, and marketplaces.

Dynamic pricing is the practice of automatically adjusting product prices in real time based on demand, competition, inventory levels, and other market signals.

A+ Content

A+ Content (formerly Enhanced Brand Content) lets brand-registered Amazon sellers add rich images, comparison charts, and formatted text modules below the product description to improve conversion.

Email marketing is the practice of sending targeted messages to a list of subscribers to drive sales, retention, and loyalty. For ecommerce brands it is consistently the highest-ROI owned marketing channel.

External traffic refers to visitors sent to an Amazon listing or Shopify store from sources outside the platform — social media, email, influencers, Google Ads, or editorial coverage.

The Amazon Flywheel describes a self-reinforcing growth loop: more sales → better BSR → higher organic ranking → more visibility → more sales. Each turn of the wheel compounds the next.

Fulfillment by Amazon

FBA lets sellers ship inventory to Amazon's warehouses. Amazon handles picking, packing, shipping, returns, and customer service — and products become Prime-eligible.

Fulfillment by Merchant

FBM means the seller stores, packs, and ships their own orders rather than using Amazon's warehouse network. It offers more control but typically loses Prime eligibility.

Global Trade Item Number

A GTIN is a globally recognised product identifier — including UPCs and EANs — required to create most new Amazon listings. It links your product to a global product database.

Google Shopping displays product listings — image, price, store name — at the top of Google search results. For Shopify brands, it is one of the highest-intent paid acquisition channels.

Gross margin is the percentage of revenue remaining after subtracting the cost of goods sold. It is the foundation of every profitability decision an ecommerce seller makes.

The hero image is the main product photo displayed in search results and at the top of a listing. It is the single highest-impact element of any ecommerce product page.

The honeymoon period is the window immediately after a new Amazon listing goes live when Amazon's algorithm gives it extra keyword ranking exposure to test its conversion potential.

A hijacker is an unauthorised seller who lists against your Amazon ASIN — often selling counterfeit or inferior products — potentially stealing the Buy Box and damaging your brand.

Impressions count how many times an ad or listing was displayed to a shopper. High impressions with low clicks signal a keyword targeting or creative problem.

Influencer marketing is paying or gifting creators with an existing audience to promote your products. For ecommerce brands it drives awareness, social proof, and direct sales through affiliate links or promo codes.

Inventory Performance Index

IPI is Amazon's score (0–1000) measuring how efficiently an FBA seller manages their inventory. A low IPI score triggers storage restrictions and surcharges.

The customer journey maps every touchpoint from first awareness of a brand to post-purchase loyalty — helping sellers identify where they lose shoppers and where to invest marketing resources.

Choosing and optimising image formats (JPEG, PNG, WebP) for product listings directly impacts page load speed, image quality, file size, and whether backgrounds render as transparent or white.

Just-in-Time Inventory

Just-in-Time inventory is a strategy of ordering stock to arrive precisely when needed — minimising storage costs and tied-up capital — rather than holding large safety buffers.

Key Performance Indicator

A KPI is a specific, measurable metric used to evaluate performance against a business goal. Every ecommerce seller needs a small set of KPIs to know whether their business is growing or declining.

Keyword harvesting is the process of mining Amazon PPC search term reports to identify which customer search queries are generating sales, then moving those terms into dedicated exact match campaigns.

Keyword ranking is your product's position in search results for a given search term. Ranking higher means more visibility, more organic clicks, and more sales without additional ad spend.

Customer Lifetime Value

LTV is the total revenue (or profit) a customer is expected to generate over their entire relationship with your brand. It determines how much you can sustainably spend to acquire a customer.

A Lightning Deal is a time-limited promotion on Amazon that offers a product at a discounted price for a few hours, appearing on the Deals page and in search results with a countdown timer.

Listing optimization is the ongoing process of improving every element of an Amazon product page — title, images, bullets, A+ Content, keywords, and price — to increase both search visibility and conversion rate.

Minimum Order Quantity

MOQ is the smallest quantity a supplier will produce or sell in a single order. Understanding and negotiating MOQ is foundational to managing cash flow and product launch risk.

Multi-Channel Fulfillment

Multi-Channel Fulfillment lets Amazon FBA sellers use their Amazon inventory to fulfil orders from other sales channels — Shopify, eBay, or their own website — using Amazon's warehouse and logistics network.

Net profit margin is the percentage of revenue remaining after all costs — COGS, fulfilment, advertising, fees, and overhead. It is the ultimate measure of business profitability.

Negative keywords are terms you explicitly exclude from your PPC campaigns to prevent your ads from showing for irrelevant searches, reducing wasted spend and improving ACoS.

Net profit is the money remaining after subtracting all business costs from total revenue. It is the fundamental measure of whether a business is making or losing money.

Net Promoter Score

NPS measures customer loyalty by asking how likely customers are to recommend your brand on a 0–10 scale. It is one of the strongest leading indicators of customer retention and word-of-mouth growth.

Order Defect Rate

ODR is the percentage of orders that result in a negative experience — negative feedback, an A-to-Z claim, or a chargeback. Amazon requires ODR below 1% to maintain a healthy seller account.

Organic rank is your product's unpaid position in Amazon search results for a keyword. The higher your rank, the more free traffic you receive — making it the most valuable long-term asset an Amazon seller can build.

Out of Stock

Out of stock means you have no available inventory to fulfil orders. Going OOS on Amazon causes immediate BSR drop, organic rank loss, and review accumulation pause — every day OOS costs more than the lost sales themselves.

A parent ASIN is the non-purchasable top-level listing that groups all variants of a product (sizes, colours, scents) together. Reviews and BSR consolidate at the parent level, making variation strategy one of the most powerful tools in Amazon selling.

Pay-Per-Click

PPC is an advertising model where you pay only when a shopper clicks your ad. On Amazon it's the primary traffic driver for new listings and keyword rank building.

Private label means manufacturing a product under your own brand name, typically sourced from a third-party manufacturer. It is the dominant business model for Amazon sellers building long-term brand equity.

Q4 (October–December) is the highest-revenue quarter for most ecommerce sellers, driven by Black Friday, Cyber Monday, and holiday gifting. It can represent 30–50% of annual revenue and requires months of advance preparation.

Quality Score (used by Google Ads) rates how relevant your ads, keywords, and landing pages are to the user. A higher Quality Score lowers your CPC and improves ad position — making it a lever for reducing advertising costs.

Quantity discounts incentivise customers to buy more units per order by offering a lower per-unit price at higher quantities. They increase average order value and reduce fulfilment costs per unit sold.

Replenishment is the process of restocking inventory before it runs out. Your reorder point is the inventory level that triggers a new purchase order — calculated to ensure stock arrives before you sell out.

Return on Ad Spend

ROAS measures revenue generated for every dollar spent on advertising. It's the inverse of ACoS and the standard metric in Shopify, Meta, and Google advertising.

Review velocity is the rate at which a product accumulates new reviews over time. Amazon's algorithm rewards consistent review accumulation — and a sudden spike or drop in velocity can trigger account scrutiny.

An Amazon Storefront is a branded multi-page shopping experience within Amazon.com, available to Brand Registry members. It acts as a mini-website on Amazon where you can showcase your full product range and brand story.

Sponsored Products are Amazon's most widely used ad format — cost-per-click ads that appear in search results and on product pages, directly linking to your product listing. They are the primary driver of paid traffic for most Amazon sellers.

Stock Keeping Unit

A SKU is a unique internal code you assign to each product or variant. It is how your inventory system, warehouse, and reports track individual items.

Title optimization is the process of crafting your product title to maximise keyword relevance, CTR, and conversion rate. The title is the highest-weighted field in Amazon's search algorithm and the first thing shoppers read.

Total Advertising Cost of Sale

TACoS measures ad spend as a percentage of total revenue — organic plus paid. It shows the true cost of advertising relative to your whole business, not just ad-attributed sales.

Traffic sources identify where your visitors come from — search (organic or paid), social, email, direct, or referral. Understanding your traffic mix reveals which channels drive the most profitable customers and where to invest for growth.

Units sold is the total number of product units sold in a given period. It is the raw output metric underlying revenue, BSR, organic rank, and reorder planning — the heartbeat of any product business.

An upsell is an offer to upgrade a customer to a higher-value version of what they're purchasing. It increases AOV by persuading buyers already in purchase mode to spend more on a better product.

User-Generated Content

UGC is content created by customers or creators rather than the brand — photos, videos, or reviews. It converts better than polished brand content because it feels authentic.

Sales velocity measures how quickly a product sells over a given period, typically expressed as units per day or revenue per day. It is the primary driver of BSR, organic rank, and Amazon's confidence in your inventory replenishment needs.

A variation is a specific purchasable version of a product — such as a particular size, colour, or flavour. Variations grouped under a parent ASIN share reviews and BSR, making variation strategy one of the most powerful tools for accelerating launch and improving conversion.

A virtual bundle is an Amazon listing that combines two or more separate ASINs into a single purchasable offer without physical repackaging. It increases AOV and can surface complementary products to buyers who would otherwise only see one item.

Walmart Marketplace is the third-party seller platform on Walmart.com, the second-largest US ecommerce platform. It offers lower competition than Amazon and growing traffic with lower advertising costs, making it a strong channel for brands already established on Amazon.

White label means selling a generic, off-the-shelf product under your own brand name without modifying the formula or design. It offers a faster and cheaper path to market than private label, at the cost of product differentiation.

Wholesale is selling your products to retailers or distributors in bulk at a discounted price (typically 40–60% below MSRP). It trades lower per-unit margin for higher volume and offline distribution — and is a distinct revenue channel from DTC or marketplace selling.

Cross-border commerce is selling products to customers in countries other than where you are based. It multiplies your addressable market but introduces complexity around duties, VAT/GST, customs documentation, and localised customer expectations.

An XML product feed is a structured data file that lists your entire product catalogue — titles, prices, images, inventory — in a standardised format that platforms like Google Shopping, Facebook Catalog, and comparison sites use to display and sell your products.

Year-over-Year Growth

Year-over-year (YoY) growth compares a metric in the current period to the same period 12 months prior, eliminating seasonal fluctuations. It is the standard benchmark for measuring real business growth.

The Amazon Best Seller badge (the orange/yellow '#1 Best Seller' ribbon) is awarded to the top-selling product in a subcategory. It significantly improves CTR and conversion rate — and is one of the most valuable signals of trust on Amazon.

Yield rate is the percentage of manufactured units that pass quality control and are sellable. A yield rate below 95% significantly impacts effective COGS and signals a supplier quality problem that needs addressing.

Z-score inventory analysis uses statistical standard deviations to flag ASINs with abnormal sales patterns — sudden velocity spikes or drops that may signal a stockout risk, a viral moment, or a listing problem requiring immediate attention.

A zero-click search is one where the user gets their answer directly on the search results page — without clicking any result. On Google, zero-click results (featured snippets, knowledge panels) reduce organic traffic to websites; understanding them is critical for content SEO strategy.

A zero-to-one launch is the process of taking a product from zero sales and zero reviews to a self-sustaining organic rank. It is the most critical and capital-intensive phase of an Amazon product lifecycle — executed well, it determines whether a product succeeds or fails.