Marketing analytics
Marketing efficiency ratio.
Divide all revenue by all marketing spend for the same period. Add your gross margin to see the break-even MER and what is left after marketing.
MER = total revenue / total marketing spend. $40,000 of revenue on $10,000 of marketing is an MER of 4.0, and at a 40% margin the break-even MER is 2.5.
Your numbers
Result
Worked example
Total revenue is $40,000 and total marketing spend is $10,000, so MER = 40,000 / 10,000 = 4.0, and marketing is 25% of revenue. At a 40% gross margin the break-even MER is 1 / 0.40 = 2.5. Gross profit is $16,000, so profit after marketing is $6,000.
How it works
MER = total revenue / total marketing spend, over the same period and every channel. Because it uses one revenue figure and one spend figure, it does not depend on platform attribution.
Break-even MER = 1 / gross margin. Polar Analytics gives the same relationship: a 40% margin means a break-even MER of 2.5. Below it, each marketing dollar loses money on a first-order basis.
Which spend counts? Sources disagree. Some define the denominator as ad spend only, which is also called blended ROAS, and others include agency fees, creative and tools. Pick one definition and keep it constant. Whichever you use, say which in your reports.
Polar describes MER as a directional health metric rather than a media-buying control: it cannot show which channel or creative is wasting money. It also ignores repeat purchases.
Sources and basis (opened 2026-10-15): MER: Marketing Efficiency Ratio - Polar Analytics. Everything else is arithmetic on your inputs.
Inputs are user-entered figures. Results are planning estimates, not financial advice or a forecast of future performance. Everything runs in your browser. Nothing you type is sent or stored.
FAQ
What is the MER formula?
Total revenue divided by total marketing spend for the same period.
What is a good MER?
It depends on your margin. Break-even MER is 1 divided by gross margin, so a 40% margin needs at least 2.5. Anything above it leaves money for other costs and profit.
What is the difference between MER and ROAS?
ROAS usually divides the revenue a platform attributes to its ads by that platform's spend. MER divides all revenue by all marketing spend, so it needs no attribution.
Does MER include organic and repeat sales?
Yes. Total revenue includes everything, which is why MER is steadier than platform ROAS but less precise about what ads actually caused.