No more confusion! E-commerce terms explained in an easy-to-understand way

Are you just starting out with your Amazon FBA business and have relatively little experience in the world of e-commerce? Especially at the beginning, there can be a lot of confusion with all the technical terms. But even as an experienced Amazon seller, it’s worth taking a look at our comprehensive Amazon FBA lexicon.

We help you to bring clarity to the jungle of terms! In this article you will find all the important terms and abbreviations relating to Amazon and e-commerce.

General terms – Amazon FBA Lexicon

Amazon FBA: FBA stands for Fulfillment by Amazon, i.e. the platform’s fulfillment service. The service can be described as a kind of “fulfillment” by Amazon: You use Amazon as a sales channel for your own products and send them to an Amazon warehouse. Amazon will then take care of sales, shipping, customer service and returns for you.

Amazon FBM: FBM stands for Fullfilled by merchant and means that the seller is responsible for storage, shipping and customer service. In contrast to FBA, FBM sellers have to ship their products themselves.

Amazon’s marketplaces: Amazon has various marketplaces worldwide, including Amazon.de, Amazon.co.uk, Amazon.com, etc. You can list your products on multiple marketplaces to increase your reach.

Amazon Vine: Amazon Vine is a program where selected sellers send free products to Amazon customers to get reviews.

A-Z Guarantee: The A-Z Guarantee is a protection measure for Amazon customers that guarantees them a refund or replacement if a problem arises with an order and the seller does not provide a satisfactory solution.

B2B: Stands for Business to Business. If you sell your products to a business customer or wholesaler, you are operating in the B2B business.

B2C: Means business to consumer. Sales via Amazon are mostly made to private end customers.

Bundle: If you offer a set of several products, this is called a bundle.

Early Reviewer Program: The Early Reviewer Program is an Amazon program that encourages shoppers to submit reviews for new products by offering them a small reward.

Launch: This refers to the initial phase of your product sales. It is important to position yourself in the best possible way in order to sell successfully on Amazon.

Landed Cost: Landed cost refers to the total cost amount incurred when you purchase a product from your supplier and ship it to your FBA warehouses. It includes the purchase price, shipping costs, customs duties and other associated costs.

Private Label SellerAs a PLS, you sell products with your own brand.

Packaging licensing: As an Amazon Seller, you must register with a packaging register and indicate how much packaging waste is put into circulation by your company.

Amazon Seller Central and Listing – Amazon FBA Lexicon

Abandoned Cart: An abandoned shopping cart refers to the state when a customer places products in their shopping cart but does not complete the purchase. Remarketing for abandoned shopping baskets can help to win back these customers.

Amazon Seller Central: Seller Central is the platform on which you manage your Amazon seller account. Here you can list products, process orders, download reports and manage your sales activities.

ASIN: The ASIN (Amazon Standard Identification Number) is a unique identification number that Amazon assigns to each product. It is used to identify products on the Amazon platform.

Inventory placement: With inventory placement, sellers can choose whether their products should be distributed across multiple Amazon warehouses (distributed inventory) or centralized in a single warehouse (centralized inventory).

Ratings and reviews: Customers can rate products on Amazon and leave reviews. Positive ratings and reviews are important to gain the trust of potential buyers and promote sales.

Evaluation requests: Review requests are messages that you can send to buyers to ask them to leave a review for your product. There are specific guidelines for sending such requests on Amazon.

BSR: Stands for bestseller rank. Depending on its performance, each listing is assigned a BSR in the respective category based on the sales volume. The lower the BSR, the more frequently the product is sold.

Bullet points: These are the key points on your product listing to the right of the product images. These give you another opportunity to emphasize your product benefits. Be sure to include important keywords.

Buy Box: The Buy Box is the area on the Amazon product page where customers can add the product directly to their shopping cart. Only a seller can have the Buy Box for a specific product. The Buy Box is an important factor for sales success.

Buy Box competition: The Buy Box competition refers to the competition between different sellers to win the Buy Box for a particular product. Factors such as price, shipping speed and ratings influence the chances of winning the Buy Box.

EAN code: Stands for European Article Number. This number consists of 13 digits and is used to identify products. It is mainly used in Europe and is also required for registration on Amazon.

EBC/A+: Stands for Enhanced Brand Content. If you have registered a trademark, you can use this instead of the product description. With EBC you have the opportunity to present your product even better to the customer. You can use additional images, tables and text to convince the customer of your product and increase your conversion rate.

FNSKU number: Stands for Fulfillment Network Stock Keeping Unit. This is an Amazon-specific barcode that is used to track and identify products stored in the Amazon fulfillment network.

Weight and size restrictions: Amazon has certain weight and size restrictions for products shipped with FBA. It is important to know and adhere to these restrictions to avoid potential problems during storage and shipping.

Hijacking: Hijacking occurs when a third-party vendor takes over a seller’s product listing by offering the same product at a lower price or inferior quality. It is important to take measures to prevent hijacking.

Inventory Age: The Inventory Age refers to the age of your stock on Amazon. It is important to check stock levels regularly and sell older stock to minimize storage fees.

Inventory Performance Index (IPI): The IPI is a value that evaluates the efficiency of your inventory management on Amazon. It is based on factors such as stock availability, inventory turnover and inventory planning.

Category rankings: Amazon classifies products into different categories and assigns them category rankings. The category ranking indicates how well a product sells compared to other products in the same category.

Customer service level: The customer service level is a measure of customer satisfaction based on returns, complaints and customer ratings. A good level of customer service is important to build trust with customers.

Storage fees: Amazon charges storage fees for the
Storage of your products in their fulfillment centers. The fees are based on the storage space required and the storage period.

Product listing: This refers to the page that a customer sees on Amazon when they click on your product. The listing contains the title, images, bullet points, description and technical data.

Ungating: Ungating refers to the process,
activate certain categories or brands on Amazon. Some categories require additional permits or proof in order to be allowed to sell in them.

UPC (Universal Product Code): The UPC is a globally unique barcode that is used to identify products. It is often required for the registration of products on Amazon.

Seller account: The seller account is the account that you register as a seller on Amazon in order to sell products. It gives you access to all sales functions and tools.

Sales limits: Amazon sets sales limits for new sellers or sellers with low sales volume to reduce the risk of fraud or substandard products. Sell limits can be lifted later if certain requirements are met.

Sales rank: The sales rank indicates how well a product sells compared to other products in a particular category. A low sales rank indicates that a product is sold frequently.

Sourcing – Amazon FBA Lexicon

B/L: Stands for Bill of Loading, the “consignment note”. You will receive this letter from your supplier. You need it to import your goods.

EORI number: You apply for this number at customs in order to import your products from China to Europe, for example.

Incoterms: These determine the rules for the acceptance and delivery of the goods between you and your manufacturer. FOB is the most popular Incoterm. In this case, your manufacturer brings your goods to the port of destination. Your logistics provider will take over from there.

MOQ: Is the abbreviation for Minimum Order Quantity. This refers to the minimum order quantity.

OOS: Stands for Out Of Stock and means that your goods are not in stock. You should urgently avoid going OOS as you could lose your BSR and be listed further down the list.

PL: This is the packing list, i.e. the shipping list that your manufacturer creates to let you know how your goods are packed. This information is required by customs and your logistics provider.

PO Agreement: Means Purchase Order Agreement and is the order contract between you and your manufacturer. Here you can record all important product details and terms and conditions,

Purchase Agreement: This is the purchase agreement between you and your manufacturer.

Quality Inspection: You should definitely have a quality check carried out before importing your goods to Germany. You can commission an independent company to do this (Third Party Quality Inspection).

Sample: This is a test sample of your product that you have your manufacturer send you to assess the quality before you place an order for large-scale production.

Shipping Marks: This refers to the information that your manufacturer should print on the shipping cartons, such as your company name, item number, product description, etc.

Trade Assurance: If you have found your manufacturer via Alibaba, you can use Trade Assurance. The payment to your manufacturer is made via Alibaba.

Certificate: Many products must meet certain quality standards before you are allowed to sell them in Germany. After you have completed the relevant tests, you will receive the respective certificate.

SEO, marketing and PPC – Amazon FBA Lexicon

ACoS: Stands for Advertising Cost of Sale. In German, it is the “attributed cost of sales”. This refers to the ratio of advertising costs to sales generated.

For example, if your PPC spend is €1 and you generate a turnover of €10, your ACoS is 10%. The ACoS helps you to recognize how effective your PPC strategy is.

ASIN competition analysis: The ASIN competition analysis refers to the analysis of competitor products that have the same ASIN as your product. You can analyze price, ratings and other factors to improve your competitive strategy.

Backend keywords: You can use the backend keywords to position additional keywords in the background. After the title, these have the greatest influence on the visibility and ranking of your products on Amazon.

Brand Registry: The Brand Registry is an Amazon program that provides registered brand owners with additional tools and protections to protect their brands on Amazon and optimize their listings.

Conversion rate: Describes the relationship between the number of purchases and the number of visitors to your product page. A higher conversion rate indicates that more visitors are becoming customers. For example, if out of 100 people who click on your listing, 10 people buy your product, your conversion rate is 10%.

CPC: This is the cost per click. This refers to the cost per click of a customer on your advertisements.

Cross-selling: Cross-selling refers to the practice of offering customers additional products that may match their current purchase. It can increase the average order size and boost sales.

External traffic: Platforms such as Instagram, Facebook and Google give us the opportunity to attract more visitors to our products through external traffic.

KeywordsAre search terms or keywords in the search bar on Amazon. The algorithm shows the customer the most relevant results for the respective search term on the search results page (SERP).

Lightning Deals: Lightning Deals are special offers on Amazon for a limited time. You can offer your products at a reduced price to boost sales.

Multi-channel sales: Multi-channel selling refers to selling your products not only on Amazon, but also on other platforms such as eBay, Shopify or your own online store.

USP: USP stands for Unique Selling Proposition. Your USP is the unique selling point that sets you apart from another brand or product. Today, it is more important than ever to stand out from the mass of products on Amazon with a well-developed USP. You should therefore take plenty of time for this during product development.

PPC: Stands for pay per click. With this advertising method on Amazon, you place ads for which you pay a certain amount per click. This will increase your visibility and sales.

Pricing strategy: The pricing strategy refers to setting the optimal price for your products on Amazon. You should consider factors such as cost, competition and demand to develop an effective strategy.

Product Matching: Product matching on Amazon refers to the process of comparing your products to existing ASINs on Amazon to determine if they are already listed on the platform.

Repricing: Repricing refers to the automatic adjustment of prices for products on Amazon. Sellers can use repricing tools to adjust their prices to the competitive situation in real time and increase their chances of buying the Buy Box.

ROI: Stands for return on investment. To what extent was your investment worthwhile? Divide your margin by the purchase price and multiply the result by one hundred. For example, if you invest €1 and get €2, your ROI is 100%.

SEO: Means search engine optimization. The aim of Amazon SEO is to improve the ranking of certain keywords and increase visibility among search queries.

Sponsored Brands: Sponsored Brands are advertisements on Amazon that highlight your brand. They include your logo, an individual slogan and several advertised products.

Sponsored Products: Sponsored Products are advertisements on Amazon where your products appear in the search results or on the detail pages of similar products. You only pay when a customer clicks on your ad.

TACoS(Total Advertising Cost of Sale): In contrast to ACoS, TACoS refers not only to sales via advertising campaigns, but also to the combination of organic sales and sales via advertising campaigns. If you subtract the ACoS from the margin before advertising expenditure, you get the effective margin.

Traffic: This refers to the number of customers on Amazon who have been on your listing.

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here how we as an Amazon agency can simplify your everyday life as a seller!