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Ecommerce acronyms come in handy for saving space on charts and time in conversations. There is a learning curve involved, however, especially when it comes to Amazon acronyms, which aren’t commonly used outside of the platform. For example, tacos may be a tasty meal offline, but TACoS on Amazon helps sellers to determine how effective their advertising campaigns are.
In this ecommerce acronym dictionary, we have compiled definitions of the most important acronyms you need to know and provided some insight on what makes each of them so important.
The FBA (Fulfillment By Amazon) program is one of the biggest reasons Amazon is among the most popular options for third-party sellers in the United States and around the world. This service allows sellers to store their products in Amazon's fulfillment centers, and then when an order is placed, Amazon takes care of packing, shipping, and most customer service on behalf of the seller.
FBA provides several advantages including simplified logistics and customer service, as well as the opportunity to offer fast and reliable shipping. To learn more about what Amazon FBA means and how it compares to FBM (Fulfilled By Merchant), check out this post on the pros and cons of FBA vs. FBM.
The Fulfilled by Merchant option on Amazon is an alternative fulfillment method to FBA in which the seller retains control over the storage, packing, and shipping of their products. This approach provides e-commerce businesses with greater autonomy and flexibility in their operations.
While it may not offer the same benefits as FBA, FBM allows for more personalized branding, inventory management, and cost control. Sellers using FBM can cater to specific customer requests and maintain their unique fulfillment processes. Whether you should sell using FBA or merchant fulfilled will depend on the specifics of your business and logistical preferences.
Amazon’s Multi-Channel Fulfillment gives ecommerce sellers the opportunity to reach a larger number of potential customers by offering their product line across multiple online sales channels. This service gives FBA sellers the option to take advantage of all the logistics that Amazon FBA provides, and to use certain Amazon-integrated tools to process and track non-Amazon orders.
For example, if you are using Onsite Support as your Walmart customer service app, you can ship orders from your integrated Amazon MCF account to Walmart customers without even needing to change screens.
The Amazon Standard Identification Number is a unique identifier assigned to products listed on Amazon's marketplace. This alphanumeric code distinguishes each product within Amazon's vast inventory, simplifying product searches and ensuring accuracy in product listings. ASINs enable sellers and customers to locate and identify specific items quickly and make it easier for sellers to optimize their product listings, maintain inventory, and track sales performance.
A European Article Number is a global barcode system used for product identification, predominantly in European markets. EANs provide a standardized way to label products, making it simpler to track inventory, manage stock levels, and facilitate smooth transactions. Ecommerce businesses use EANs to ensure accurate product identification, helping customers find and purchase the items they desire efficiently.
An International Standard Book Number is an essential ecommerce acronym for book retailers. ISBNs are unique codes assigned to books for the purpose of identification and categorization. These numbers simplify the process of listing books online and help customers locate specific editions or titles. Sellers will generally use ISBNs when selling books online, though there are ways to sell on Amazon without an EAN, ISBN or UPC.
The Stock Keeping Unit on a product is a universal identifier used to distinguish and categorize individual products within a retailer's inventory. SKUs are alphanumeric codes designed to simplify the organization of products, making it easier for businesses to manage their stock effectively and fulfill customer orders promptly.
Merchant Stock Keeping Units are customizable identifiers that give sellers even more power over their organization and analytics. Through the use of MSKUs, ecommerce sellers can encode important details into each product, such as the purchase price or supplier for a specific item. While creating unique MSKUs can be time-consuming if done manually, you can automate the process with tools like InventoryLab’s custom MSKU generator.
The Universal Product Code is the widely recognized barcode system used to label products for sale in various retail environments, both in retail stores and online. UPCs provide a standardized method of identifying products, reducing errors in listing and stocking to enhance the customer's shopping experience. If you’ve ever purchased a product from a big box store with a scannable barcode, you have dealt with UPCs before.
The Advertising Cost of Sales quantifies the effectiveness of advertising campaigns by calculating the ratio of advertising spend to sales revenue. ACoS is listed as a percentage and can be solved with the equation ad spend divided by sales from ads. A low ACoS signifies that the advertising campaign is generating a healthy return on investment, while a high ACoS may indicate the need for adjustments.
The Cost Per Click is a fundamental metric in online advertising. It measures the expense incurred by the business every time a user clicks on an advertisement. In e-commerce, CPC plays a pivotal role in assessing the efficiency of paid advertising campaigns, especially on advertising platforms like Amazon, Facebook, and Google. Sellers must factor the CPC of their ads into their budgets and profitability calculations.
Cost Per Mille is a blend of English and Latin that roughly translates to “cost per thousand (impressions).” Whereas the CPC focuses only on advertisements that have been clicked on, the CPM counts all impressions regardless of how often they have been clicked. This metric is key to businesses that rely on brand awareness and visibility, like those selling customized products on Amazon Handmade and Etsy.
An advertisement’s Click-Through Rate is a pivotal metric in digital marketing that assesses how effective ad campaigns are in enticing users to click on an advertisement. It is calculated by dividing the number of clicks by the number of impressions and is expressed as a percentage. A high CTR reflects that an advertisement is compelling and relevant to the audience it is reaching, while a low CTR suggests room for improvement.
Pay Per Click is a popular advertising model in which advertisers pay a fee each time a user clicks on their online advertisement. It is a common strategy in ecommerce, allowing businesses to promote their products or services while only incurring costs when potential customers express genuine interest by clicking on the ad. PPC advertising tends to be more popular than paying per impression, as those impressions may not be valuable ones if they aren’t generating clicks.
Return On Ad Spend is another Amazon metric that measures the revenue generated for every dollar spent on advertising. It is expressed as a percentage and can be calculated by taking “ad sales” and dividing by “ad spend.” A high ROAS signifies that advertising efforts are yielding a healthy return on investment, while a lower ROAS may suggest there is room for improvement.
TACoS is very similar to ACoS, with the difference being that it takes the total sales of a product into account instead of just the sales generated from ads. This gives sellers a broader picture of how well the product is selling overall, which could be influenced by the increased exposure, sales ranking and feedback being generated by an ad campaign. If you still aren’t sure which metric to use, here’s a more detailed explanation of the difference between Amazon ACoS, TACoS, and ROAS.
Business-to-Business sales are a type of commerce in which businesses engage in transactions with other businesses rather than directly with individual consumers. B2B ecommerce simplifies the processes of establishing partnerships, collaborating with suppliers, and accessing bulk pricing.
Business-to-Consumer sales represent the traditional model where businesses sell their products or services directly to individual consumers. It forms the backbone of online retail, enabling companies to reach a broad customer base and offer personalized shopping experiences. B2C ecommerce is vital for businesses looking to provide convenience and accessibility for customers to shop for a wide range of products and services.
Peer-to-Peer sales signify a collaborative approach to ecommerce where individuals (or peers) engage in direct transactions with one another, bypassing traditional intermediaries. P2P ecommerce platforms include online marketplaces such as Facebook and Craigslist that facilitate interactions among users who may wish to buy, sell, or trade goods and services.
A/B testing, which is also called split testing or control (A) vs. variant (B) testing, is a method of experimentation that compares two versions of a marketing campaign, featured image or something else to determine which performs better. By assessing user behavior and preferences, A/B testing allows businesses to make data-driven decisions, improving conversion rates, enhancing user experiences, and ultimately driving higher sales and revenue.
Customer Acquisition Cost quantifies the expenses incurred to acquire a new customer. It plays a key role in helping businesses understand the efficiency of their marketing and advertising efforts. Lowering CAC is essential to long-term success in ecommerce as building your brand and running effective targeted ads should result in more efficient spending.
Customer Lifetime Value assesses the total revenue a business can expect from a customer throughout their entire relationship. CLV provides insights into customer retention, loyalty, and long-term revenue potential. By understanding CLV, businesses can tailor their marketing strategies, customer support, and product offerings to maximize the long-term value of each customer.
A product’s Estimated Time of Arrival signifies when it is expected to be delivered to the customer. Accurate ETAs are important for ecommerce businesses as they provide transparency and reliability in delivery expectations. One-day and two-day ETAs for Prime members on Amazon are among the company’s strongest selling points.
Profit and Loss outlines a business's revenues, costs, and expenses, providing a comprehensive view of its financial performance. With a clear picture of all your company’s expenses, you can get a much more accurate report of your profitability than you can from simply looking at sales and revenue. FeedbackWhiz’s Profit and Loss Tracking Tool takes the guesswork out of keeping track of your P&L.
ROI, short for Return On Investment, is one of the most well-known and important ecommerce acronyms there is. It measures the gains or losses relative to the costs incurred, providing valuable insights into the effectiveness of financial decisions. Businesses with lower ROI per unit, like those selling groceries on Amazon, require a higher volume in sales to be successful.
An online marketplace’s Terms of Service are fundamental legal documents in ecommerce that outline the rules and guidelines governing the use of a website or platform. When you sell on popular platforms like Amazon, eBay, Walmart or Etsy, you must always be sure to understand and adhere to the rules outlined in each site’s ToS. Breaking rules outlined in a platform’s ToS can lead to penalties and even a loss of your selling privileges.
A Top Rated Seller on eBay is a title awarded to sellers who consistently provide excellent customer service and maintain high levels of customer satisfaction. Gaining TRS status on eBay immediately lets potential customers know that your brand and products can be trusted.
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