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MER (blended ROAS): how to use it without fooling yourself

A practical guide to MER: what it is, how it differs from ROAS, how to compute break-even/target MER, and common pitfalls.

Updated 2026-02-16

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MER Calculator
Example: $500k revenue, $100k marketing spend, 40% margin, 20% buffer

What MER is

MER (marketing efficiency ratio) is total revenue / total marketing spend over the same period. It's a top-down metric that reduces attribution noise, but it hides channel-level performance.

MER formula (how to calculate)

MER = total revenue / total marketing spend (use the same time window for both).

Break-even and target MER

  • Break-even MER ~ 1 / contribution margin (variable economics).
  • Target MER should be higher than break-even to leave buffer for uncertainty, overhead, and measurement error.

How to use MER in practice

  • Track MER for overall health and directional trends.
  • Use channel-level ROAS/CPA and incrementality for optimization decisions.
  • Adjust analysis for seasonality, promos, pricing changes, and returns.

Common mistakes

  • Optimizing to MER alone (can hide wasted spend).
  • Comparing periods with different attribution windows or delayed revenue recognition.
  • Using gross revenue without netting refunds/returns where meaningful.

FAQ

Is MER better than ROAS-
They're different tools. MER is better for a top-down check across channels. ROAS (and CPA) are better for within-channel optimization, especially when paired with incrementality tests.
What period should I use-
Use a consistent window that matches your business cycle (weekly for fast ecommerce, monthly for many teams). Make sure revenue and spend are aligned in time.

More in paid ads

Paid ads measurement hub: ROAS, MER, marginal ROAS, and incrementality
A practical hub for paid ads measurement: connect ROAS to profit, use MER for top-down truth, watch marginal ROAS for scale, and validate incrementality with holdouts.
Marginal ROAS: how to scale ads with diminishing returns
A practical guide to marginal ROAS: why average ROAS misleads at scale, how diminishing returns work, and how to pick a profit-maximizing spend level.
Attribution vs incrementality: what to trust, when, and how to test
A practical guide to attribution vs incrementality: common attribution models, window pitfalls, how MER/marginal ROAS fit in, and how to run holdout/geo tests.
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