E-commerce terms, explained
Short, practical definitions with real examples — and the calculator that goes with each one.
A
ACoS — Advertising Cost of Sales
ACoS is the share of ad-driven sales spent on advertising: ad spend ÷ ad sales × 100. It is the main efficiency metric in Amazon Sponsored Products.
AOV — Average Order Value
AOV is the average amount a customer spends per order: revenue ÷ number of orders.
ASIN — Amazon Standard Identification Number
An ASIN is the 10-character ID Amazon assigns to each product in its catalog (for example B0XXXXXXXX). One product page = one ASIN.
B
Backend search terms
Backend search terms are hidden Amazon keywords that help a listing get found but aren’t shown to shoppers. The field must stay under 250 bytes.
Break-even ACoS
Break-even ACoS is the highest ACoS you can run without losing money. It equals your profit margin before advertising.
Break-even point
The break-even point is the number of units (or revenue) where total contribution covers fixed costs: fixed costs ÷ (price − variable cost per unit).
BSR — Best Sellers Rank
BSR is Amazon’s sales rank for a product within its category, based on recent and historical sales. Lower is better — #1 is the best seller.
Buy Box
The Buy Box (Featured Offer) is the main “Add to Cart / Buy Now” box on an Amazon product page. When several sellers offer the same product, Amazon chooses which offer wins it.
C
CAC — Customer Acquisition Cost
CAC is what you spend on marketing to win one new customer: marketing spend ÷ new customers.
CBM — Cubic Meter
CBM is the volume of a shipment in cubic meters (length × width × height in meters). Sea and air freight are priced on volume and weight.
Chargeback
A chargeback is when a customer disputes a card payment with their bank and the money is pulled back from the seller, usually with a dispute fee.
COGS — Cost of Goods Sold
COGS is the direct cost of the products you sold in a period — usually the landed cost of each unit sold.
Contribution margin
Contribution margin is what each sale adds toward fixed costs and profit: price − variable cost per unit.
Conversion rate
Conversion rate is the share of visits that end in an order: orders ÷ sessions × 100. On Amazon it is reported as Unit Session Percentage.
CPC — Cost Per Click
CPC is the average amount you pay each time someone clicks your ad: ad spend ÷ clicks.
CTR — Click-Through Rate
CTR is the share of people who click after seeing your ad or listing: clicks ÷ impressions × 100.
E
Etsy Offsite Ads
Offsite Ads are Etsy’s ads on other sites. When a sale comes from one, Etsy charges 12–15% of the order (capped at $100). Shops above $10,000 in yearly sales must take part.
Etsy transaction fee
Etsy charges a 6.5% transaction fee on the item price plus the shipping and gift-wrap charges, on top of listing and payment processing fees.
F
FBA — Fulfillment by Amazon
With FBA, you send inventory to Amazon’s warehouses and Amazon stores, picks, packs and ships orders and handles customer service and returns, for per-unit and storage fees.
FBM — Fulfilled by Merchant
With FBM you store and ship Amazon orders yourself (or through your own logistics partner) instead of using FBA.
Final value fee
eBay’s final value fee is a percentage of the total amount the buyer pays — item, shipping and sales tax — charged when an item sells, plus a small per-order fee.
Free shipping threshold
A free shipping threshold is the minimum order value at which you offer free shipping, such as “free shipping over $50”.
G
Gross margin
Gross margin is revenue minus the direct cost of the goods sold, as a percentage of revenue. It excludes overheads like software and salaries.
GTIN / UPC / EAN
GTINs are global product barcodes. UPC (12 digits) is common in North America, EAN (13 digits) elsewhere; both end in a check digit.
L
Landed cost
Landed cost is the total cost of getting a product to where you sell it: product cost + freight + insurance + duties + customs and other fees.
Lead time
Lead time is how long it takes from placing a purchase order until the stock is available to sell — production, freight, customs and warehouse receiving.
Listing suppression
Suppression is when a marketplace hides a listing from search because something is missing or breaks a rule — such as a title over the limit, a missing main image or a restricted claim.
LTV — Customer Lifetime Value
LTV (or CLV) is the profit a customer brings over their whole relationship with your store. A practical formula: AOV × orders per year × gross margin × years.
P
Payment processing fee
A payment processing fee is what a payment provider (Stripe, PayPal, Square, Shopify Payments) charges to accept a card payment — usually a percentage plus a fixed amount.
Product schema (structured data)
Product schema is code (usually JSON-LD) on a product page that tells search engines the product’s name, price, availability, brand and reviews.
Profit margin
Profit margin is profit as a percentage of the selling price: (price − cost) ÷ price × 100.
R
Referral fee
A referral fee is the commission a marketplace like Amazon or Walmart takes on each sale, as a percentage of the total sales price (often including shipping).
Reorder point
The reorder point is the stock level at which you should place a new purchase order: average daily sales × lead time + safety stock.
ROAS — Return on Ad Spend
ROAS is the revenue earned for every dollar spent on ads: ad sales ÷ ad spend. It is the inverse of ACoS.