Gross merchandise value is the total value of merchandise sold through a marketplace or ecommerce platform in a specific time frame, before deductions like returns, discounts, or fees.
Why Gross Merchandise Value (GMV) matters
GMV is a common metric for marketplaces and large platforms because it shows total transaction volume, regardless of how much of that value becomes the platform’s revenue. It’s an important measure of scale and market activity.
How Gross Merchandise Value (GMV) works
GMV = Total value of all items sold over a given period. This is usually measured before subtracting costs, returns, or cancellations. For ecommerce stores, GMV can be a useful indicator of total sales momentum, especially if you operate across multiple sales channels.
Example in ecommerce
A multi-seller marketplace reports a GMV of $50 million for the year. While the platform only keeps 10% as revenue through commissions, GMV growth signals increasing seller success and platform adoption.
Common mix-ups
GMV is not revenue, it’s the value of all goods sold, not the amount the business actually earns after fees. It’s also not profit, which accounts for operating costs.
Best practices
- Track GMV alongside revenue and net profit for a complete view.
- Segment GMV by category or seller type.
- Use GMV trends to attract new sellers or partners.
- Monitor GMV growth rate as a leading indicator of market health.
- Compare GMV seasonality to marketing and inventory plans.
Industry benchmarks
- GMV growth rates vary widely, high-growth marketplaces may aim for 50%+ year-over-year increases.
- Established marketplaces often target steady GMV growth alongside margin expansion.
