A few months ago, I sat down with a brand that had a healthy-looking 6x ROAS on Meta and was scaling hard. The problem? Their margins were shrinking, and bank deposits weren’t matching platform-reported revenue. Once we stepped back and looked at their MER, the real picture emerged: overspending, inflated attribution, and a budget strategy stuck in the past.
If you’re still budgeting for digital like you would for catalogs or trade shows, chances are you’re either leaving money on the table—or slowly bleeding cash.
Here’s how to modernize your eCommerce budgeting strategy, cut through the noise of attribution, and scale with confidence.
In today’s omnichannel world, attribution has become a game of “he said, she said.” Each channel wants credit for the same sale. Google says it was the search ad. Meta claims it was their video. An affiliate wants the win, too.
Let’s break down the issues:
Common Attribution Models:
But here’s the catch: most platforms don’t deduplicate conversions. That means the same sale could be counted 2–3 times—giving you a false sense of performance.
Example: A shopper scrolls past an ad they never saw (it loaded below the fold), but that channel still takes credit when the shopper purchases via email later.
The Smarter Metric: MER > ROAS
Instead of relying on messy, platform-owned attribution models, smart brands use MER (Marketing Efficiency Ratio) to budget and evaluate performance.
MER = Total Revenue ÷ Total Ad Spend
Where ROAS tells you how a specific channel thinks it performed, MER tells you how efficiently your total marketing spend is driving real business growth.
| Metric | Formula | Focus | Pros | Cons |
| ROAS | Revenue / Spend | Channel-level | Useful for testing & tweaks | Easily inflated by platforms |
| MER | Total Revenue / Total Spend | Business-wide | Tells the real story | Lacks channel detail |
💡 You can’t deposit ROAS. But you can manage your cash flow with MER.
It starts with your revenue goals—and works backward from your product margins.
Step 1: Set a MER Target
Let’s say your target MER is 4.0 (i.e., $4 earned for every $1 spent), and your revenue goal is $1M.
→ Your max ad spend would be $250K.
Step 2: Run Budget Scenarios
This lets you scale up intelligently or pull back before it’s too late.
It’s tempting to focus on attributed revenue, especially when platform dashboards look amazing. But your real revenue is what hits your bank account—not what Meta or Google says they contributed.
Key Metrics to Track:
Margin = Sales – Cost of Goods Sold
Don’t panic.
Promotions drive more volume, but often at a lower margin—so your MER will dip. The key is to forecast it, plan for it, and look at performance seasonally.
Pro tip: Track MER weekly, monthly, and year-over-year for promo periods. Zoom out to spot trends.
Real Talk: What ROAS Won’t Tell You
“But Meta says our ROAS is 5x!”
Sure—but Meta doesn’t know what Google’s doing, or what your email flows contributed. And it certainly doesn’t know your product margin.
That 5x could be more like a blended 3x MER once you look at total spend across all channels. That’s a very different picture—and one with more financial truth behind it.
Analogy: If two people both say they made the same sale, you can’t count it twice.
Common Pitfalls (and What to Say Instead)
“We’ve always used ROAS, and we’re fine.”
Totally fair—but how do you know you’re not underinvesting in top performers or overspending where results are inflated?
“How do I allocate budget using MER?”
Use a test-and-learn approach. Look at CAC per channel, track incremental lift, and evaluate blended MER at the business level. Simulate budget shifts before moving dollars.
“MER drops during sales—should we pause?”
No. Contextualize it. Your margins are thinner, so your efficiency will dip. But volume and brand lift could still make the promo worth it in the long run.
Free Options:
🎯 Want to get started? Download our MER-based Budget Planner
When in doubt, zoom out. Attribution will never be perfect. But business-level metrics like MER and topline revenue keep you focused on what matters: profitable, sustainable growth.
Key Takeaways:
✅ MER is your best indicator of marketing efficiency.
✅ ROAS is helpful—but often inflated.
✅ Budget for revenue goals—not for what your ad platforms say.
✅ Track over time, not just week to week.
✅ Growth ≠ efficiency—make sure both are working in tandem.
Have questions? Want to see what this looks like for your brand? Reach out—we’ll walk you through how to make the switch.
