Glossary
Shopify and ecommerce terms, explained
Plain-language definitions of the terms behind our apps, with a straight answer first and links to the guides that go deeper.
AI product photography
AI product photography uses an AI image model to create product photos, such as turning a flat-lay packshot into an on-model image, without a physical photoshoot. For apparel, it places the product on a generated model in a chosen pose and background. The output goes on product pages in place of, or alongside, studio photos.
Cost of goods sold (COGS)
Cost of goods sold, or COGS, is the direct cost of the products you actually sold: what you paid your supplier per unit, plus any per-unit cost to get them ready to sell. It does not include overheads like rent, salaries or ad spend. COGS is the first cost you subtract from revenue to get gross profit.
Duplicate product images
Duplicate product images are the same or near-identical images used across multiple products, or repeated on a single product. They pad your media library, can slow page loads, and dilute image SEO because search engines see the same picture many times. A perceptual scanner finds them by visual similarity, not just by exact file matches.
Gross profit
Gross profit is revenue minus the cost of goods sold: what is left after you subtract what the products you sold cost you, before any other expenses. It sits between revenue and net profit. A healthy gross profit can still turn into a net loss once fees, shipping, returns and ad spend are counted.
Image alt text
Image alt text is a short written description of an image, stored in the image's alt attribute. Screen readers read it aloud for shoppers who cannot see the image, and search engines use it to understand and rank the image, which is how products show up in Google Images. On Shopify, every product image has an alt text field.
Net profit
Net profit is what a store keeps after subtracting every cost from its revenue: product cost, payment fees, shipping, returns, taxes, ad spend and fixed costs. It is different from revenue, which is total sales, and from gross profit, which is sales minus product cost only. A store can have high revenue and still make no net profit.
Overselling
Overselling is accepting an order for more units than you actually have in stock, leaving you unable to fulfil it. On Shopify it usually happens in the gap between a sale and the inventory update, when two shoppers buy the last unit at once or a fulfilment sync lags. The fix is a safety-stock buffer that stops selling before inventory hits zero.
QR code ticket
A QR code ticket is an event ticket that carries a unique QR code, which staff scan at the door to check the attendee in. Each code is single-use once scanned, so it cannot be reused for duplicate entry. On Shopify, a ticketing app generates the QR ticket automatically when someone buys.
ROAS (return on ad spend)
ROAS, or return on ad spend, is revenue divided by ad spend: a 4x ROAS means $4 of revenue for every $1 spent on ads. Regular ROAS ignores what the product and fulfilment cost you, so a campaign can show a healthy ROAS while losing money. Profit-aware ROAS compares ad spend to profit instead, using your real margin.
Safety stock
Safety stock is a buffer of inventory you keep in reserve so you do not sell out during a demand spike, a slow reorder, or the timing gaps that cause overselling. Your safety-stock level is the point at which you stop selling a product, rather than selling all the way to zero. Shopify has no built-in safety-stock setting, so merchants add one with an app.
Shopify product vendor
In Shopify, the vendor is the brand or manufacturer of a product, set in the product's Vendor field. Shopify uses it for filtering and for vendor-based automatic collections, but it does not create a customer-facing "shop by brand" page on its own. A brand-page app turns your vendors into a browsable directory.