Top 10 eCommerce Merchandising Acronyms

If you’ve just entered the world of site merchandising or taking your eCommerce career to the next level, you might be asking yourself, “What are all these acronyms?’ Don’t fret – our experts are here to provide you with the tools you need to succeed. That starts with learning the top acronyms you are likely to use daily in any digital merchandising career. We’ve put together a comprehensive guide to the most-used eCommerce acronyms by retail professionals.

1. SKU

What is a SKU? A SKU, or Stock Keeping Unit, is a unique identifier for each product available in your inventory. You may also hear this referenced as a PID, or Product Identifier. Product IDs and SKUs help streamline inventory management, order processing, and data analysis, ensuring consistency and accuracy across various systems and platforms.

2. PIM

What is a PIM? A PIM, or Product Information Management system, is a software solution designed to centralize and manage all the data related to a product (SKU or PID). PIM systems provide a single place where all product information is stored, including product titles and descriptions, specifications, images, videos, and more. PIM systems are particularly valuable for businesses with large and diverse product catalogs, as they simplify the management of complex product information and ensure that it is always up-to-date and accurate.

3. PDP

What is a PDP? A PDP is a Product Detail Page. The PDP is any page on your website that displays a single product to the customer. The key components of a PDP include the product name, product description, product images, price, and a button for the customer to add the item to their cart where they can ultimately checkout. Learn more about PDPs.

4. PLP

What is a PLP? A PLP is a Product Landing Page. The PLP is any page on your website that includes a grid of products available for sale. This is sometimes referred to as a category landing page (CLP) because this page displays all products that live in a specific category. Learn more about PLPs.

5. KPI

What is a KPI? KPIs, or Key Performance Indicators, are the metrics that are used to determine the performance of your overall business. KPIs vary across business units and departments. A site merchandising team will regularly monitor financial and site health KPIs.

6. AOV

What is AOV? The AOV, or Average Order Value, is the average dollar amount that your customer spends in one purchase. This is sometimes referred to as average basket value because this is the average revenue per order. The formula for calculating average order value is the total revenue divided by number of orders.

$$\text{AOV}=\frac{\text{Total Revenue}}{\text{Number of Orders}}\backslash text\{AOV\}\; =\; \backslash frac\{\backslash text\{Total\; Revenue\}\}\{\backslash text\{Number\; of\; Orders\}\}$$

For example, if your total revenue for a month is $50,000 and you had 1,000 orders, the AOV would be:

$$\text{AOV}=\frac{50,000}{1,000}=\mathrm{\$}50\backslash text\{AOV\}\; =\; \backslash frac\{50,000\}\{1,000\}\; =\; \backslash \$50$$

This means that, on average, each order generated $50 in revenue. AOV is a useful metric for understanding customer purchasing behavior and can help businesses develop strategies to increase the average revenue per order.

7. UPT

What is UPT? Units per Transaction is the average number of items purchased in a single order. The formula to calculate UPT is the total units sold divided by the number of orders (transactions).

$$\text{UPT}=\frac{\text{Total Units Sold}}{\text{Number of Orders}}\backslash text\{UPT\}\; =\; \backslash frac\{\backslash text\{Total\; Units\; Sold\}\}\{\backslash text\{Number\; of\; Orders\}\}$$

For example, if a store sells 200 units across 50 transactions in a day, the UPT would be:

$$\text{UPT}=\frac{200}{50}=4\backslash text\{UPT\}\; =\; \backslash frac\{200\}\{50\}\; =\; 4$$

A UPT of 4 means, on average, each order (transaction) included the purchase of 4 units. UPT is a useful metric for understanding customer buying behavior and can help businesses identify opportunities to increase the number of items customers purchase per transaction.

8. ASP

What is ASP? Average Selling Price refers to the average price at which a product or service is sold over a specific period of time. It’s a useful metric for understanding pricing trends and revenue. The formula used to calculate ASP is dividing the total revenue from sales by the number of units sold.

$$\text{ASP}=\frac{\text{Total Revenue}}{\text{Number of Units Sold}}\backslash text\{ASP\}\; =\; \backslash frac\{\backslash text\{Total\; Revenue\}\}\{\backslash text\{Number\; of\; Units\; Sold\}\}$$

For example, if your total revenue from selling 1,000 units of a product is $50,000, the ASP would be:

$$\text{ASP}=\frac{50,000}{1,000}=\mathrm{\$}50\backslash text\{ASP\}\; =\; \backslash frac\{50,000\}\{1,000\}\; =\; \backslash \$50$$

This means the average price at which each unit was sold is $50. ASP is a useful metric for understanding pricing trends and revenue in e-commerce and retail.

9. CVR

What is CVR? Conversion Rate, or CVR, is the percentage of visitors that ultimately checkout from your online store. The formula to calculate conversion rate is number of orders (transactions) divided by number of visits.

$$\text{CVR}=\frac{\text{Number of Orders}}{\text{Number of Visits}}\times 100\mathrm{\%}\backslash text\{CVR\}\; =\; \backslash frac\{\backslash text\{Number\; of\; Orders\}\}\{\backslash text\{Number\; of\; Visits\}\}\; \backslash times\; 100\backslash \%$$

For example, if your website had 1,000 visitors and 50 of them made a purchase, the Conversion Rate would be:

$$\text{CVR}=\frac{50}{1,000}\times 100\mathrm{\%}=5\mathrm{\%}\backslash text\{CVR\}\; =\; \backslash frac\{50\}\{1,000\}\; \backslash times\; 100\backslash \%\; =\; 5\backslash \%$$

This means 5% of your visitors made a purchase. Conversion Rate is a key metric for understanding the effectiveness of your marketing efforts, site health and user experience.

10. CTR

What is CTR? Click Through Rate is the ratio of users who click on a specific link to the number of total users who view a page, email, or advertisement. The formula to calculate click thought rate is number of clicks divided by the number of impressions.

$$\text{CTR}=\frac{\text{Number of Clicks}}{\text{Number of Impressions}}\times 100\mathrm{\%}\backslash text\{CTR\}\; =\; \backslash frac\{\backslash text\{Number\; of\; Clicks\}\}\{\backslash text\{Number\; of\; Impressions\}\}\; \backslash times\; 100\backslash \%$$

For example, if your ad was shown 1,000 times and 50 users clicked on it, the CTR would be:

$$\text{CTR}=\frac{50}{1,000}\times 100\mathrm{\%}=5\mathrm{\%}\backslash text\{CTR\}\; =\; \backslash frac\{50\}\{1,000\}\; \backslash times\; 100\backslash \%\; =\; 5\backslash \%$$

This means that 5% of the users who saw your ad clicked on it. CTR is a crucial metric for evaluating the effectiveness of online advertising and email campaigns.

Conclusion

The eCommerce landscape is evolving every day, but these acronyms are critical to the success of any eCommerce business and every site merchandiser’s career.