What is GMV (gross merchandise value)?
GMV (gross merchandise value; also referred to as gross merchandise volume) is a metric that represents the total monetary value of all goods and services sold by a merchant in a given period. Typically, GMV is measured on a quarterly or annual basis. One simple formula to calculate gross merchandise value or gross revenue for an online store is to multiply the sales price charged to customers by the amount of merchandise sold.
GMV vs net sales
Because GMV does not account for accrued expenses like marketing and advertising costs, this metric alone will not give a complete picture of the health of an ecommerce store, its net sales, or its net income. For more accurate insights into a business’s performance, GMV should always be considered alongside other key metrics, such as customer acquisition cost, customer lifetime value, net merchandise value, and churn rate.