Yeah, so ranking by lettered tiers is a pretty common thing in many competitive spheres, be it video games, card games, or tabletop games. Calling the highest tier S instead of A comes from Japan, specifically from concert tickets - seats are organized into lettered categories based on price point, with S being the best and most expensive seats. From there, it migrated to fighting games like Street Fighter, and continued to spread throughout competitive gaming, including card games and tabletop games. It hasn’t yet made its way to physical sports yet as far as I know, but if you’re familiar with just about any competitive gaming, you’ve probably been exposed to tier lists at some point, and there’s a high chance you’ve seen one where S is the highest tier. As I mentioned in another post, it’s also a whole genre of YouTube video, which started with videos analyzing competitive games, especially Super Smash Bros, but at this point is applied to any and every form of media. You can find tier list videos for characters from just about any intellectual property, entries in just about any series, films in just about an genre; I’ve even seen a tier list of political ideologies, thought that was satyrical.
Like, I get that everyone has different experiences and of course there are people who won’t have been exposed to any given concept. But this is not just an anime thing, or even an anime and video games thing (and given the prevalence of video games in pop culture and the crossover between video game players and D&D players, I’d still be surprised to meet many D&D players who hadn’t been exposed to the concept). It has pretty thoroughly saturated pop culture media.