Glossary
Ecommerce glossary
The Tanqory ecommerce glossary defines the terms you meet running an online store, in plain words. Each term shows how it is calculated or used, works through an example with the arithmetic shown, and answers the questions merchants ask about it.
A
Abandoned cart
A shopping cart that a shopper filled and left without placing an order.
Average order value (AOV)
The average amount a store takes per order over a period: revenue divided by the number of orders.
C
Chargeback
A card payment reversed by the buyer's bank after the buyer disputes the charge with that bank, so the money is taken back out of your account.
Conversion rate
The share of visits to a store that end in an order over a period: orders divided by sessions, times 100.
Customer lifetime value (CLV)
The gross margin a store earns from one customer over the whole time that customer keeps buying: average order value × orders per customer × gross margin.
D
Discount code
A short code a buyer enters at checkout to lower the price, under rules you set: how much it takes off, on which products, for whom, how many times and between which dates.
F
Fulfillment
The work of getting a paid order to the buyer: receiving stock, picking and packing the items, buying a label, handing the parcel to a carrier, tracking it and handling any return.
G
Gross margin
The share of revenue left after the cost of the goods you sold: revenue minus cost of goods sold, divided by revenue.
I
Inventory turnover
The number of times a store sells through its average stock in a period: cost of goods sold divided by average inventory at cost.
P
Payment gateway
The service that sends a buyer's card or other payment details from your checkout to be approved, and returns the answer to your store so the order can go through.
S
Stock keeping unit (SKU)
The code a store gives each distinct item it stocks, down to size and color, so that every version of a product has its own stock count and sales record.