50 Essential Amazon Terms Every Seller Should Know

Amazon is a complex ecosystem that continues to rapidly expand. Selling successfully on world’s largest e-commerce marketplace requires a comprehensive understanding of its ever-changing protocols, policies, and platforms. To brands that are new to Amazon, terms like A+ Content and Inventory Performance Index might sound like foreign business jargon, but they carry great significance – especially for sellers who want to cut through the competition and develop their Amazon presence into a powerful sales channel. In fact, after 26 years of remarkable growth, Amazon has developed what some might consider to be its own vocabulary. To help expedite your fluency in Amazon lingo, Channel Key has compiled this glossary of the top 50 essential terms every seller should know.

A

  • A+ Content: Formally called Enhanced Brand Content, the A+ Content feature enables brand owners to change the product descriptions of branded ASINs. Using this tool, you can describe your product features in a different way by including a unique brand story, enhanced images, and text placements. Adding A+ to your product detail pages can result in higher conversion rates, increased traffic, and increased sales when used effectively.
  • Account Health: The current state of your seller account’s adherence to the performance targets and policies required to sell on Amazon.
  • Advertising Cost of Sales (ACoS): A metric used to measure performance of Sponsored Products campaigns. ACOS represents the ratio of ad spend to promoted product sales. It is calculated as ad spend divided by attributed sales.
  • Advertising Creative: The advertising imagery, video, and text that communicates your message to your audience.
  • Advertising Format/Type: The type of advertisement that you use. Examples of common formats include video and display.
  • Advertising Objective: The goal you want to achieve from digital advertising. Examples include brand awareness, consideration, purchase, and loyalty.
  • Advertising Placement: The place where an advertisement appears. Examples include in search queries on Amazon.com, on Amazon devices (such as Fire TV or Fire tablet), and on third-party sites.
  • ASIN: An Amazon Standard Identification Number is a 10-character alphanumeric unique identifier assigned by Amazon and its partners for product identification within the Amazon organization.
  • Attribution: Before someone buys a product or service, they may see several advertisements for it. For example, they may hear a radio commercial, see a billboard, and then see an online ad. Attribution refers to which advertisement was responsible for driving that purchase. Different services have different attribution models.

B

  • Best Seller Ranking: The Amazon Best Sellers calculation is based on Amazon sales and is updated hourly to reflect recent and historical sales of every item sold on Amazon.
  • Bidding: The amount an advertiser is willing to pay to have shoppers click on an advertisement. With Amazon Advertising, you can use automatic bidding (you set a bid amount and Amazon chooses the keywords and implements bid modifiers based on your settings), or you can choose manual bidding and set your own bid.
  • Brand Analytics: A feature that contains valuable insights to empower Brand Owners to make informed, strategic decisions about their product portfolio and marketing/advertising activities.
  • Brand Lift: A measurement of the direct impact your ads have on a shopper’s perception and behaviors toward a brand. Amazon calculates this metric in many ways using post-exposure success metrics, such as brand awareness, and likelihood to purchase metrics.
  • Brand Registry: A program for brand owners that provides exclusive access to a suite of tools designed to build and protect brands and create a better experience for customers.
  • Brand Store: A customized storefront that allows businesses to showcase their brand and products in a multipage, immersive shopping experience on Amazon.
  • Budget: The amount of money you are willing to spend on your advertising campaign.
  • Bundle: A group of two or more complimentary products grouped and sold together as one ASIN.
  • Buy Box: The white box on the right side of product detail pages that enable customers to add items to their cart or make direct purchases.

C

  • Child Listing: A product that falls within the category of a dedicated Parent Listing.
  • Click Through Rate (CTR): The percentage of ad impressions that are clicked as compared to the entire number of impressions. The standard calculation for CTR is (clicks/impressions) x 100.
  • Consumer Purchase Journey/Consumer Decision Journey: A term that refers to the sum of experiences that shoppers go through when interacting with your company and brand. Instead of looking at just a part of a transaction or experience, the customer journey documents the full experience.
  • Conversion: An action that a customer completes; this phrase can be used to refer to any number of actions, including clicking “Add to Cart,” completing a purchase, etc.
  • Conversion Rate (CVR): The percentage of customers who purchase a product after visiting the product detail page.
  • Cost Per Click (CPC): The average cost you pay each time someone clicks your ad. This number is calculated by dividing the amount of money you spent on an ad divided by the number of clicks it received. Sponsored Products and Sponsored Brands are examples of cost-per-click ads, so you only pay when your ad receives clicks.
  • Cost Per Thousand Impressions (CPM): The average cost you pay to deliver 1,000 impressions of your ads. Amazon’s Demand Side Platform (DSP) uses this model instead of the CPC model.
  • Coupon: A promotion wherein a discount is available on a given product. The customer has to “clip” this promotion to accept it. This does not impact your lowest price that Amazon tracks for deals.
  • CRaP: The process of Amazon discontinuing purchase orders on a product from a vendor after deciding it can no longer realize a profit.

D

  • Deal of the Day: A promotion that features a discount on an item for about a day.
  • Demand Side Platform (DSP): The software that is used to access digital advertising inventory. Amazon DSP offers both self-service and managed options.

F

  • Fulfillment by Amazon (FBA): Referred to as Amazon Fulfillment Network by Amazon, FBA is fulfillment solution wherein businesses store products in Amazon warehouses and utilize Amazon fulfillment logistics.
  • Fulfilled by Merchant (FBM): Referred to as Merchant Fulfillment Network by Amazon, FBM is fulfilment solution wherein businesses use Amazon’s marketplace to sell products but rely on their own logistics to fulfill the orders.

I

  • Impressions: The number of times an ad was rendered on a page or device.
  • Inventory Performance Index (IPI): A metric determined by Amazon that measures how efficient and productive you are in managing your FBA inventory.

K

  • Keyword: Keywords are used to target your ads to relevant shopping queries. You may select the keywords you’d like to target using manual targeting or let Amazon select the keywords using automatic targeting.

L

  • Lightning Deal: A time-bound, promotional offer where an item is featured for a limited number of hours, usually 4 to 12 hours (as determined by Amazon), on the Amazon Deals page
  • Long-Term Storage Fee: Inventory that has been in an Amazon fulfillment center for more than 365 days is charged a monthly long-term storage fee in addition to the monthly inventory storage fee.

M

  • Managed vs. Self-Service: Products in digital advertising are often categorized as either self-service or managed. Self-service products can be used directly by the advertiser or agency, while managed services require varying levels of support.
  • Minimum Order Quantity: A customer-facing, offer-level attribute informing customers of the minimum quantity to be purchased from an ASIN’s offer.

N

  • New-to-Brand Metrics: New-to-brand metrics describe customers purchasing your brand/product for the first time on Amazon over the past year. These metrics gives advertisers the tools to estimate the cost of engaging new customers on Amazon and identify the most efficient channels and tactics to achieve their campaign goals.

P

  • Parent Listing: A “non-buyable entity” used to relate child products.
  • Prime: A paid subscription program from Amazon that is available in various countries and provides users with access to additional savings, services, and benefits including (most importantly) free expedited shipping.
  • Product Detail Page: A product detail page is where a customer discovers a unique product sold on Amazon.
  • Programmatic: A term used in the digital advertising industry which refers to the automated buying and selling of digital advertising inventory.

R

  • Reach: The total number of unique users who are shown the same ad on any web page or screen.
  • Retail Readiness: the state of product listings that are fully optimized to attract, convert, and satisfy customers in an efficient and streamlined manner.
  • Return On Ad Spend (RoAS): A measure of how many dollars you earn for every dollar you spend on advertising. The standard calculation for ROAS is (Revenue – Cost) / Cost.

S

  • Seller Central: The web interface that 3P merchants use to market and sell their products to customers on Amazon’s marketplace.
  • Sponsored Brands: Keyword-targeted banner ads that appear in shopping results on Amazon, allowing brand owners to promote multiple products or titles with a custom headline and logo within the ad creative.
  • Sponsored Brands Video: A video at type within the Sponsored Brands advertising suite.
  • Sponsored Display: A self-service display advertising solution that helps businesses reach relevant audiences both on and off Amazon.
  • Sponsored Products: A cost-per-click, keyword-targeted advertising solution that enables you to promote the products you sell with ads that may appear in highly visible placements on Amazon. Sponsored Products also enables you to target ASINs through Product Targeting.

V

  • Vendor Central: The web interface that 1P manufacturers and distributers use to sell their products wholesale to Amazon, which then sells them directly to consumers.

ABOUT CHANNEL KEY

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