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111 terms that Every Amazon Merchant needs to know in 2021.

August 16, 2020


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111+ terms that every Amazon Merchant needs to know in 2020.

Basic Ecommerce terms:

  • Affiliate Marketers: Sellers of other people's products for a commission
  • Retail Arbitrage: Selling already branded products with other sellers on the same listing on Amazon
  • Business-to-Business (B2B): Companies that sell products or services to other companies. 
  • Category: How Amazon organizes all of their products
  • Gated Category: Categories that Amazon only allows qualified sellers to list products into.
  • Fulfilled-By-Amazon (FBA): a way of selling on Amazon that utilizes the shipping and delivery service that amazon offers
  • Fulfilled-by-Merchant (FBM): a way of selling on Amazon where the seller is responsible for getting the product to their customer
  • Fulfillment Center (FC): When an FBA seller ships their products to Amazon, they go to a fulfillment center until they are bought and shipped to the customer. 
  • Keyword: What must be optimized on your product listing in order for Amazon's A9 Algorithm to pick your listing in the ranking. 

Business Basics

  • Business License: A legal entity that helps you separate your personal wealth from your business adventures and also, if maintained properly, can protect your personal assets from a malicious lawsuit. 
  • Employer Identification Number (EIN): This is a business's tax ID number, so that when you file your biz tax return, the IRS has a way to identify your business.
  • Business Plan: A short description of what your business does and where it is going.
  • Gross Profit: The Total Revenue that Your Business makes. 
  • Net Profit: The total revenue minus taxes
  • Revenue: money that your business brings in.
  • Sales: Products that your business sells

Financial Vocabulary

  • Average Monthly Sales: The monthly income that your business brings in.
  • Average Price: The cost of your product throughout the year
  • Cost of Goods Sold (COGS): the amount your pay your supplier to acquire the products to sell on Amazon
  • Gross Margins: The difference between total sales revenue (the sum of all your sales) and total cost of sales (what you paid for the product and what you paid to sell them)
  • Net Profit: This is the income of your business minus the taxes and interest you pay. (compare to Gross Margin)
  • Revenue: This is the total amount of income that your business makes
  • Sales: The number of products that your business sells

Business Funding Options

  • Credit Score: a metric that the three credit bureaus assign to you or your business based on what has been reported to them.
  • Business Credit: Lines of funding available based on a number of factors including how long your company has been open, monthly revenue and percentage of on-time payments.
  • Business Credit Score: A summary of your biz credit history ranging from 0 to 100 (worst to best)
  • Business Credit Card: A line of credit that is secured via your biz's EIN number as opposed to your personal Social Security Number.
  • Bootstrapping: A method to get your business started using your personal credit cards to start funding your business.
  • Family Loan: an amount of money that your family gives you with the arrangement for you to pay them back in the future. 
  • Personal Loan: a loan that you qualify for based on your personal credit score
  • Personal Credit Cards: personal lines of credit that you qualify for based on on your personal credit history. 

Listing Components

  • Product Title: The first words about your product that Amazon shoppers see
  • Bullet Points: Your first chance on your listing to share key benefits and details about your product that show its distinct value to your prospects.
  • Listing Optimization Service: Often offered by experienced copywriters, this handy service will enable you to quickly obtain a high conversion rate if you don't have developed the writing skills or don't have the time to get it done.  
  • Character Limit: the max number of letters and symbols that Amazon allows in the different sections of your listing (often these differ depending on the category). 
  • Lifestyle Image: An image of your product being used in ordinary life
  • Product Image: Amazon prefers that you have a high quality image of your product with a white-background to show on its listing, which Amazon sellers refer to as a product image. 
  • Infographic: this is a picture of your product with arrows pointing out its different functions. 

Product Selection Basics

  • Category: the section on Amazon into which your product is organized. 
  • Sub Category: the sub section which offers further classification of your product. (Note: your product can be in more than one sub-category, but only one main category. 
  • Review: not much to say about product reviews, basically comes down to the obvious "the more the better"
  • Profit Margin: look for a product that you can get at least 30% profit margin after paying all fees and production costs. 
  • Passion: It's often helpful to pick a item that you are interested in, but don't rely on being passionate alone, make sure that the product has good metrics. 

Common Digital Advertising Terminology

  • A/B Testing: there are a number of programs that you can subscribe to that will alternate the listing shown to customers so that you can figure out which one has better conversions. 
  • Ad Daily Budget: this is the max amount of money you want to spend on Amazon PPC on a given day. 
  • Ad Clicks: the number of times your ad has been selected by prospects. 
  • Ad Impressions: the number of times your ad has been shown to shoppers.
  • Ad Sales: this is metric  that shows you how many sales have derived from customers clicking on ads.
  • Ad Status: a number of signs can shown to you in the Promotions section letting you know whether or not your ad is properly set up or is running or paused. 
  • Ad Targeting: Rather than targeting on a certain population like Facebook PPC, you can get ads on listings, at the top of the search engine or throughout the search engine results, all stimulated by keywords typed in by shoppers. 
  • Amazon Marketing Services (AMS): this is the seller-set-up ad system that Amazon created to enable sellers to use their paid ads.
  • Automatic Targeted Ads: When beginning your first ad campaign, it'd be helpful to first run an automatic campaign to get some data and then build your manual campaigns on top of that. 
  • Bid+: there's apps that enable you to automatically increase your bid to win the top of the search results in certain instances, but that's more for advanced sellers.
  • Buy-One-Get-One Promotion (BOGO): This is one type of promotion that you can set up under the Promotions tab in Seller Central.
  • Click-Through-Rate: this is a metric used in PPC communities to show how many people from the listing hit the "buy now button, signifying their intent to complete the purchase. 
  • Cost-Per-Click: This metric conveys how much it costs you every time a prospect clicks on your ad. 
  • Cost-per-Mil/Cost-Per-Thousand Impressions (CPM/CPI): this metric conveys how much you pay to display your ad 1,000 different times. 
  • Coupons: Coupons can be set up in AMS, just make sure that you check the box to limit the number of coupons available (I've heard many horror stories of sellers losing all their products, never lost my own though) 
  • Free Shipping Promo: using this promotion, you can encourage buyers to purchase your product and save on delivery
  • Giveaway Promo: I don't use this promo unless I'm trying to build up some social buzz around my item. 
  • Headline Search Ad: this kind of ad is the most effective statistically, because it puts your item head of the top search results, using a harge banner ad that you can place multiple products into. (Note: only sellers who've registered their brands are eligible to use these kinds of ads.)
  • Lightning Deals: These speedy proms offer shoppers a few hours to enjoy steeply discounted pricing. While this kind of promotion is scheduled by Amazon, eligible sellers can opt in or out.  
  • Manually Targeted Ads: Generally speaking, there are three phases of a manual ad campaign, sifting out the best keywords and phrases to get the most sales. To find out more about these campaigns, check out my guide to Amazon PPC
  • Pay-Per-Click (PPC): This type of digital advertising is the most common as there are PPC opportunities with Google, Facebook and, of course, Amazon. 
  • Percentage Off Promo: This simple kind of promotion offers the prospect a certain percent off each item they choose to buy. 
  • Product Display Ads: These ads appear on other sellers listings. I've made the most of these ads by placing them on products that relate well with mine. (i.e. if I'm selling deck umbrella stands, I'm going to place my ads on venders who sell deck umbrellas).
  • SPLIT-TESTING: Running two (or more) different ads at the same time to find out which one results in higher conversions (sales or reviews)
  • Sponsored Brands: This type of advertising is available only to brand registered sellers. 
  • Sponsored Products: This type is available to all and is the format that the general Amazon ppc ads show up in the search results.


  • Listing quality Score (LQS): A few third party tools give completed listings a score, like your high school english teacher did your papers. 
  • Glanceable: Remember that most sellers aren't reading your listing like a scholar, but like a college student cramming for their tests. 
  • Instant Decisions: Don't construct an academic, logical argument to convince your prospect to buy your product, show the benefits of the product and the buyer will make a lightning fast choice. 
  • Readability: Use Pipes (|) and Hyphens (-) to Increase Skim-ability
  • Keywords Experimentation: Place primary keywords inside longer tail keywords to increase the words you rank for. 

Sales Funnel Elements

  • Traffic: Although you want to avoid traffic when you are driving, you want as much web traffic as you can get, as "traffic" refers to the number of visitors who come onto you product page. 
  • Landing Page: This is the first page that those who click on your ad land on, hence landing page. 
  • Lead Magnet: This is a cheap or free product that you offer prospects for their contact information, usually their email and name, but sometimes now their cellphone number. 
  • Opt-In: this is the contact form on the landing page where visitors "opt-in" to receiving your lead magnet. 
  • Sales Page: The page after your landing page, showing evidence of why the visitor should invest in your product. 
  • Transaction Page: The place where visitors who decide to buy your product input their payment information.
  • Squeeze Page: this is another name for the "opt-in" page
  • Upsell: After a buyer enters their payment information, they are redirected to another page and asked if they'd like to add another product to their order. 

Brand Basics

  • Brand Name: The name of a items or range of items by their owner, also referred to as a trademark. 
  • Branding: Positioning your product line in the market space to be perceived in a certain way 
  • Brand Registry: A program offered by Amazon that gives your products more protection from copy-catters as well as better listing content options and more advertising options (like Headline Search Ads). 
  • Logo Design: The process every brand-representing symbol goes through. 
  • Enhanced Brand Content (EBC): An elite status offered to brand registered sellers by Amazon. For more information, see "Brand Registry." 

Starting with Suppliers

  • Alibaba: An online platform used by Amazon Sellers to access chinese suppliers created by Jack Ma in 1999
  • Assessed Supplier: Suppliers that are "Gold Suppliers" and have been inspected onsite by a 3rd party company that specializes in auditing suppliers.
  • Gold Supplier: A +1 status on, meaning the supplier is given a plethora of ways to show-off their products in the search results and other places that enable them to achieve maximum product exposure, resulting in a higher ROI (return on investment).
  • Trade Assurance: A free service offered by intended to create a higher level of trust during trade agreements. They give buyers a set of legal and financial protections that suppliers will honor the main points of the contract. The three main benefits of trade assurance are: (1) On-time shipment protection, (2) Product quality protection, and (3) Payment Protection for your covered amount. 
  • Unique Product Sources: In order to create a long period of sales, your product has to be excellent in quality and difficult for competitors to mimic. To accomplish the latter, you must creatively prospect for uncommon, unthought of manufacturers of that kind of product. Just some ideas to get you started: I found a unique product source by looking into local businesses. Other sellers have found them through product fairs in other countries. 

Essential Shipping Terminology

  • Customs Clearance: The process that all imported goods go through when passing from one country into another country. 
  • Duty Tax: This is an expense that merchants that import products pay the associated governments. 
  • Export: Products made in a country and exported to other nations. 
  • Import: When products are shipped into a country, they are being imported. 
  • Inventory: Products that have been made, shipped to Amazon and organized into the Fulfillment Center then show up as inventory in the merchant's seller central account.
  • Freight Forwarder: A Freight Forwarder serves as an intermediary between supplier and the Amazon Fulfillment Center (FC), often offering a savings in storage fees as well as 3rd party inspection services. 

Product Packaging

  • Universal Product Code (UPC): Amazon recommends that you get your UPC's from GS1 directly, but many other good resellers are out there offering much lower prices. 
  • Suffocation Warning Template: If you're packing your items in plastic bags they must have a suffocation warning on them per Amazon's packaging requirements. 
  • FBA Label Requirements: All units (not just boxes of product units) must have Amazon's FNSKU labels on them, which are generated in your seller central account when you create the product listing. 
  • Blister: a simple, cheap, custom heat formed method of product packaging.
  • Box Insert: used to keep items in boxes from moving, often thermoformed to fit the product exactly. 
  • Clamshell: Made to fit the product exactly, the primary benefit of the clamshell is it offers visibility of the item from both front and back.  
  • Pouch: Similar to a sandwich bag as it is sealed on 3 sides and then closed after the item has been inserted.
  • Tray: The tray offers a lot of customization options, having the ability to be made with multiple cavities to provide both organization of parts and protection for each part individually.

Amazon Selling Fees

  • Fulfillment by Amazon Fee: The Price Amazon charges you to box and deliver your product to your buyer.
  • Closing Fee: Charged to those who sell media items (books, DVDs, Music, etc.), often it's a flat fee charged on top of referral fees.   
  • Seller Account Fees: To open a seller account on Amazon, you either agree to pay Amazon 40 dollars a month for a Professional Seller or opt to open a basic seller account where you pay a dollar per sale. 
  • Referral Fee: Amazon is referring all customers who buy your product to you, so they charge you fees for those referrals.
  • Advertising Fees: generally in the form of of CPC (cost-per-click). Web FX states that the average Amazon Seller pays 81 cents per sold product.
  • Inventory Storage Fees: As of 12/16/2019, Amazon charges 69 cents per square foot during the first 9 months of the year, and then more than 3x's that cost ($2.40/sq. ft) during Q4  (Q4=October-December). 

Search Algorithm

  • A9 Search Engine: An Amazon company that is focused on doing R&D (research and development) of Amazon's search engine and search advertising apparatus. 
  • Sales Rank: A constantly updating status given to each ASIN based on the number of sales each ASIN has accumulated. 
  • Search Algorithm: A step-by-step coded procedure utilized to find certain information inside of a collection of data. (A way of using computers to find a bunch of needles in a haystack. :)) 
  • Amazon's Choice: Beginning in 2015, this badge represents products that can be purchased through voice searched terms.  
  • Best-Seller Ranking (BSR): Displays those at the top of the "sales rank."
  • Search Engine Optimization: the process of amplifying the number of visitors that a listing on Amazon receives.  
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