- AOV (average order value)
- Revenue divided by number of orders. The easiest lever to move with bundling, thresholds and cross-sell — and the one that quietly rescues a marginal CAC, because acquisition cost is paid per order, not per dollar.
- LTV (lifetime value)
- Total contribution margin a customer produces over their relationship, not total revenue. Most stores overstate it by using revenue and an optimistic time horizon; a defensible LTV is stated with a window attached, such as 12-month LTV.
- CAC (customer acquisition cost)
- Total acquisition spend divided by new customers acquired. Blended CAC includes all marketing spend; paid CAC counts only ad-driven customers. Quoting the flattering one is the most common self-deception in DTC.
- MER (marketing efficiency ratio)
- Total revenue divided by total ad spend across every channel. Because it is measured at the bank account rather than in a platform, it is immune to attribution inflation and is the number most operators now steer by.
- ROAS (return on ad spend)
- Revenue attributed to an ad divided by its cost. Useful for relative comparison within a channel; dangerous as an absolute target because it ignores margin, returns and repeat purchase.
- Blended vs platform ROAS
- Platform ROAS is what Meta or Google claims it drove — each grading its own homework, with overlapping credit for the same order. Blended ROAS is total revenue over total spend. When platform ROAS rises while blended stays flat, the platforms are claiming credit, not creating demand.
- Contribution margin
- Revenue minus COGS, payment fees, shipping, fulfillment, returns and variable marketing — the money left to cover overhead and profit. The only per-order number worth optimising, and the reason a 4x ROAS store can still lose money.
- First-order profitability
- Whether the very first purchase covers its own acquisition cost. Brands that require a second order to break even are financing growth with working capital and are fragile to any CAC increase.
- CAC payback period
- Months of contribution margin needed to recover acquisition cost. Under 3 months is comfortable, 6-12 months requires real financing, and the number determines how fast a business can safely grow.
- Repeat rate
- Share of customers who buy again within a defined window. A structural property of the category first and of the marketing second — consumables repeat, mattresses and luggage largely do not.
- Cohort retention
- Tracking each month's acquired customers separately over time. It exposes what blended reporting hides: whether newer customers are worse than older ones, which is the earliest warning that a growth channel has hit its limit.
- Subscription / replenishment
- Recurring orders on a fixed cadence, via subscribe-and-save discounts or true subscription. It converts a variable repeat rate into forecastable revenue but introduces churn, dunning and failed-payment management as new disciplines.
- Cart abandonment
- Shoppers who add to cart and do not purchase — typically around 70% of carts industry-wide. Usability research consistently attributes the largest share to unexpected extra costs at checkout, followed by forced account creation.
- Checkout conversion rate
- Share of shoppers who complete checkout once they enter it, distinct from overall site conversion rate. Isolating it separates a traffic-quality problem from a checkout-design problem, which have entirely different fixes.
- PDP / PLP
- Product detail page and product listing page. The PLP is where shoppers filter and compare and where merchandising and faceted navigation live; the PDP is where the decision is made and where imagery, sizing, reviews and shipping clarity carry the conversion.
- SKU / variant
- A SKU is a uniquely stocked, priced and counted item; variants are the size, colour and material options grouped under one product. Variant structure decides inventory accuracy, feed eligibility and how a product is found in search.
- MOQ (minimum order quantity)
- The smallest batch a supplier will produce. It sets how much cash is locked in inventory per SKU and is the reason small brands cannot afford a long tail of variants.
- COGS (cost of goods sold)
- The direct cost of the product itself. Excluding freight, duty and inbound handling from COGS produces a margin figure that looks healthy right up until the shipping invoice arrives.
- Landed cost
- True per-unit cost delivered into the warehouse — product, freight, duty, tariffs, insurance, inbound handling and inspection. The only cost basis that supports honest pricing decisions.
- Tariffs and de minimis
- Import duty owed on goods, and the low-value shipment threshold that historically let parcels enter duty-free. Ending or tightening de minimis treatment raises the cost of direct-from-overseas parcel models and changes whether cross-border dropshipping works at all.
- 3PL (third-party logistics)
- An outsourced provider that stores inventory, picks, packs and ships orders. Pricing bundles receiving, storage, pick-and-pack and postage, so a low pick fee with high storage can be the more expensive quote.
- FBA vs FBM
- Fulfillment by Amazon versus Fulfilled by Merchant. FBA buys Prime badging, faster delivery promise and ranking benefit at the cost of per-unit and storage fees; FBM keeps margin and inventory control but usually converts worse on the same listing.
- Buy Box
- The featured offer on an Amazon product page — the add-to-cart most buyers actually use. Winning it depends on price, fulfillment method, seller performance and stock, and losing it can cut a listing's sales to near zero overnight.
- ACOS / TACOS
- Advertising Cost of Sale is ad spend over ad-attributed sales. Total ACOS measures ad spend against total sales including organic, which is the number that shows whether advertising is building a listing or merely renting it.
- Retail media
- Advertising sold by retailers against their own shopper data and inventory — Amazon Ads, Walmart Connect, Target Roundel, Instacart. High-margin revenue for the retailer, and for the seller an increasingly non-optional cost of shelf placement.
- PMax (Performance Max)
- Google's automated cross-inventory campaign type that spends across Search, Shopping, YouTube, Display, Gmail and Maps from one asset and feed set. It trades control and channel-level transparency for reach, which makes feed quality and clean conversion data decisive.
- Product feed / catalog
- The structured export of products with titles, prices, availability, images and attributes that powers Shopping ads, marketplaces, affiliates and increasingly AI shopping surfaces. Feed quality, not ad copy, is the real creative in shopping campaigns.
- GTIN / UPC / EAN
- Global Trade Item Numbers — the manufacturer-assigned barcodes that let every channel recognise the same physical product. Missing or invented GTINs suppress listings on Google and marketplaces and break price comparison.
- Google Merchant Center
- Where a product feed is submitted, validated and mapped for Google's shopping surfaces. Its disapprovals and diagnostics are the most concrete SEO-adjacent feedback loop in ecommerce, and free listings depend on it.
- Product structured data
- Schema.org Product, Offer, AggregateRating and Review markup on the page. It drives rich results, price and availability display, and is now the machine-readable layer AI shopping agents read when they decide what to recommend.
- Review velocity
- The rate at which new reviews arrive, not just the total count. Recency signals an active product to both shoppers and ranking algorithms — a five-star average whose newest review is two years old reads as discontinued.
- UGC (user-generated content)
- Customer photos, videos and testimonials used as both social proof and ad creative. It typically outperforms studio assets in paid social precisely because it does not look like an ad, and requires explicit rights and disclosure handling.
- Influencer and affiliate
- Paying creators and publishers for reach or for performance. Influencer deals are usually flat-fee and brand-building; affiliate is commission on tracked sales. Both need FTC disclosure and both are prone to paying for orders that would have happened anyway.
- Chargeback
- A bank-initiated reversal when a cardholder disputes a charge. The merchant loses the goods, the revenue and a fee, and a sustained chargeback rate above card-network thresholds puts the payment account itself at risk.
- Returns rate / RTO
- Share of orders sent back, and in markets with cash-on-delivery the return-to-origin rate for refused parcels. Apparel and footwear routinely see the highest rates, and in those categories the returns line is often larger than the profit line.
- Reverse logistics
- Everything after a return is requested — labels, transport, inspection, restocking, refurbishment, liquidation or disposal. Handled as an afterthought it destroys margin; handled well it recovers inventory and produces product-defect data nothing else surfaces.
- Inventory turns
- How many times inventory sells through in a year. Turns govern cash conversion: a brand with three turns finances its stock three times slower than one with nine, regardless of how good the marketing looks.
- Stockout / backorder
- Running out of sellable stock, and accepting orders for delivery once stock returns. A stockout kills the ad account's learning and the listing's ranking as well as the sale; a backorder preserves revenue but converts far worse and raises cancellations.
- Dropshipping
- Selling goods shipped directly by a supplier, with no inventory held. Low capital and low barrier, but also low margin, no control of delivery speed or packaging, and no defensibility — which is why most dropship stores compete only on ad creative.
- Headless / composable commerce
- Headless decouples the storefront presentation layer from the commerce backend and connects them by API; composable goes further, assembling best-of-breed cart, search, CMS, payments and PIM services instead of one suite, usually described as MACH architecture. Both buy front-end freedom at the cost of owning engineering the platform used to handle for free — powerful at enterprise scale, and normally an expensive detour for a seven-figure store.
- PCI DSS
- The card-industry security standard governing handling of cardholder data. Using a hosted or tokenised payment field dramatically narrows a merchant's compliance scope, which is the main reason self-hosting a card form is rarely worth it.
- Fraud screening
- Rules and machine scoring that flag risky orders before fulfillment. The trade-off is explicit: tighten the filter and you decline good customers, loosen it and you eat chargebacks — and the cost of a false decline is a lost customer, not just a lost order.
- Post-purchase experience
- Order confirmation, tracking, delivery notification, packaging and first-use. It is the highest-open-rate communication a brand ever sends and the window in which the second order is either earned or lost.
- Zero-party and first-party data
- Information customers deliberately give — preferences, sizes, intent — plus behavioural data collected on your own properties. With third-party cookies deprecated and platform signal degraded, owned data is what makes targeting, segmentation and measurement survivable.
- SMS compliance / TCPA
- US rules requiring prior express written consent for marketing texts, clear opt-out, and quiet-hours restraint, with statutory damages per message. SMS has the best engagement in ecommerce and by far the worst downside for sloppy list practices.
- Email deliverability
- Whether messages reach the inbox at all, governed by SPF, DKIM, DMARC, domain reputation, complaint rate and list hygiene. Major mailbox providers now enforce authentication and one-click unsubscribe for bulk senders, so deliverability is an infrastructure task, not a copy task.