Ecommerce Glossary

Canonical definitions for common seller metrics and operations terms used across pricing, fee modeling, and profitability analysis.

Last reviewed: 2026-03-27

ROI

Return on Investment. Profit generated relative to total invested cost.

Typical formula: ROI = Net Profit / Total Cost.

Return on Ad Spend. Revenue generated for each unit of ad spend.

Typical formula: ROAS = Revenue / Ad Spend.

Advertising Cost of Sales. Ad spend as a percentage of attributed revenue.

Typical formula: ACOS = Ad Spend / Ad Revenue.

Click-Through Rate. Percentage of impressions that generate clicks.

Typical formula: CTR = Clicks / Impressions.

Conversion Rate. Percentage of clicks or sessions that convert to orders.

Typical formula: CVR = Orders / Clicks.

Average Order Value. Average revenue per completed order.

Typical formula: AOV = Revenue / Number of Orders.

Fulfillment by Amazon. Amazon stores, packs, ships, and handles customer service.

Usually includes fulfillment and storage fees in unit economics.

Fulfillment by Merchant. Seller handles storage, fulfillment, and shipping workflow.

Shipping and operations costs are merchant-side variables.

Minimum selling price where net profit equals zero.

Used to set floor pricing before ads and promotions.

Revenue minus variable costs, expressed as value or percentage.

Useful for evaluating campaign and channel viability.