Gross Merchandise Value (GMV) represents the total sales dollar value of merchandise sold through a marketplace or platform, before deducting fees, returns, and other expenses. For marketplaces, GMV is a key growth metric even though it doesn't represent actual revenue.
GMV differs from revenue because platforms typically only earn a percentage of GMV as their take rate. A marketplace with $1 billion GMV and 15% take rate generates $150 million in revenue. GMV growth indicates platform health and customer activity.
For DTC brands selling through their own site, GMV essentially equals gross revenue. When evaluating DTC health, it's important to consider GMV net of returns and cancellations (Net Merchandise Value) for a more accurate picture of actual sales performance.