Media Efficiency Ratio (MER): Your Real North Star Metric

Let me introduce you to the metric that will change how you think about your marketing spend.

It’s called Media Efficiency Ratio (MER). And it’s the only marketing metric your CFO actually cares about.

Also called “Blended ROAS” or “Overall ROAS,” it’s beautifully simple:

MER = Total Revenue / Total Marketing Spend

If you spent $100,000 on all marketing (Facebook, Google, email, content, whatever) and made $500,000, your MER is 5.0.

That’s it. No attribution window debates. No platform-specific tracking. No “which channel deserves credit” arguments.

Just: Did the money in the bank grow?

Why Your CFO Loves This Metric (And Why You Should Too)

Your CFO doesn’t care if Facebook says it drove $200k in revenue. They care if the revenue actually exists.

They look at your bank balance and work backward. If you had $100k in the bank last month, and now you have $150k, and you spent $50k on marketing, then your MER was ($150k - $100k) / $50k = 1.0.

That’s breakeven on incremental marketing spend.

If you had $100k last month and now have $300k (from all sources of revenue), and you spent $50k on marketing:

MER = ($300k - $100k) / $50k = 4.0

Your media efficiently generated 4x return.

This metric is impossible to game. You can’t “attribute” your way out of it. You can’t argue about “true” ROAS. The math is built on reality: money in, money out.

The Problem with Channel-Specific ROAS

Here’s where things get interesting—and where most founders go astray.

Facebook tells you their ROAS is 5.0x. Google Ads tells you their ROAS is 4.0x. Email tells you their ROAS is 8.0x. If you add those up… they total way more than your actual MER.

Why?

Attribution chaos.

• Facebook reports revenue from users who also clicked Google ads.
• Google reports revenue from users who also saw Facebook ads.
• Email reports revenue from users who came from both paid channels.

Everyone’s double-counting. It’s like three people claiming they caught the fish, when the fish was always going to be caught—they just helped from different angles.

Your channel ROAS numbers are inflated by 40-60% compared to reality. This is why we push you to focus on MER instead.

When MER Breaks

Now, here’s the catch. MER only works if you’re tracking total marketing spend accurately.

We’ve seen founders come to us saying, “Our MER is 3.0x,” and we dig into the numbers and realize they forgot to count:

• Agency fees
• In-house salary for the marketing manager
• Software subscriptions (Klaviyo, HubSpot, etc.)
• Content creation (photographers, video editors)
• Influencer partnerships

When you add those up, their real MER might be 1.5x. Suddenly, they’re not nearly as healthy as they thought.

This is why we automate the process. We pull in:

• Ad spend from Facebook, Google, TikTok
• Software costs from your accounting system
• Team salaries (allocated to marketing)
• Everything
• Then we divide total revenue by total spend

The real MER.

The Healthy MER Benchmark

So, what should your MER be?

It depends on your business model:

For High-Margin Business (SaaS, Services): A healthy MER is 3.0 or higher. You’re making $3 for every $1 spent on marketing.

For Mid-Margin Business (E-commerce with 40-50% COGS): A healthy MER is 2.0-2.5. You’re making $2-2.50 for every $1 spent.

For Low-Margin Business (Retail with 60% COGS): A healthy MER might be 1.3-1.5. Even $1.30 for every $1 spent is solid, because your margins are thin.

If your MER is below 1.0, you’re spending more on marketing than you’re making. This is only acceptable if you’re in “growth at all costs” mode (and your investors are funding the losses).

Using MER to Make Decisions

Here’s how we use MER in your automation:

Decision 1: Should You Increase Spend? If your MER is 4.0x and you’re confident you can maintain it, increasing spend makes sense. If your MER is 1.2x, increasing spend is a bet that you’ll improve efficiency (unlikely).

Decision 2: Which Channels to Prioritize? You can’t rely on Facebook’s claim that their ROAS is 5.0x while Google’s is 3.0x. Instead, you look at historical patterns.

When you increased Facebook spend by 50%, did your total revenue increase proportionally? If yes, Facebook is contributing. If no, Facebook’s claims are inflated.

We track this by running tests:

• Week 1: Spend $10k on Facebook, $5k on Google. Revenue: $50k. MER: 2.5x
• Week 2: Spend $5k on Facebook, $10k on Google. Revenue: $40k. MER: 1.6x

This tells you Facebook is more efficient. Doubling down on Facebook and cutting Google is the right move.

Decision 3: When to Pause Spend If your MER drops below your healthy benchmark, it’s time to pause and investigate.

Did something break? (Pixel, landing page, targeting) Did the market change? (Seasonality, competitor activity) Did you over-optimize? (Ad fatigue, audience saturation)

Most founders don’t notice this until three months have passed and they’ve burned through cash. We alert you when your MER drops 20% from baseline. That’s when you investigate.

The Relationship Between MER and Profit

Here’s the final piece of the puzzle.

MER tells you if your marketing is working. It doesn’t tell you if your company is profitable.

Example:

• Revenue: $500k
• Marketing spend: $100k
• MER: 5.0x
• Product costs: $200k
• Salaries (non-marketing): $300k
• Profit: $0

You have an excellent MER and zero profit. Your problem isn’t marketing efficiency; it’s that your business model doesn’t work.

Conversely:

• Revenue: $500k
• Marketing spend: $300k
• MER: 1.67x
• Product costs: $100k
• Salaries: $75k
• Profit: $25k

Your MER is mediocre, but you’re actually profitable because your costs are low.

MER is one metric in a dashboard of metrics. But it’s the one that forces honesty.

The Takeaway

Stop asking Facebook and Google if they’re working. Stop trying to reconcile channel-specific ROAS numbers.

Ask one question: Is my total revenue growing faster than my total marketing spend?

If yes, scale. If no, pause and investigate.

That’s MER. That’s the metric that matters.