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New Customer MER (Gross Sales) is your total ad spend as a percentage of first-order sales at list price. Because welcome discounts and refunds don’t touch the denominator, it shows acquisition efficiency with your offers taken out of the picture.

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Formula

NC MER (Gross) = ( Total Ad Spend ÷ New Customer Gross Revenue ) × 100

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Formula Components

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How it works

Two things make this metric different from MER (Gross Sales). Only first orders are in the denominator. Upstack marks an order as a new-customer order when it’s the earliest non-cancelled order for that Shopify customer in your store. If a customer’s first order is cancelled, their next order becomes the new-customer order. Orders with no Shopify customer attached are neither new nor returning, so they’re left out. The numerator is still your whole ad budget. Upstack doesn’t split spend by campaign type. Retargeting and retention spend sit in the numerator too, so read this as “how much first-order sales does the whole budget buy”, not as the cost of prospecting alone. Because it uses gross sales, a deeper welcome discount doesn’t change this metric. That’s why it sits next to NC MER (Net).

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Example

A pet supplies store runs a 15%-off welcome code in May and spends $41,400 on ads. The 8-point gap between the two is what the welcome offer and refunds cost in efficiency terms. In June the store raises the code to 25% off. If NC MER (Gross) stays near 40% while NC MER (Net) climbs, the ads are performing the same and the offer is what moved.

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How to interpret it

  • Flat gross, rising net: your discounts or first-order refunds grew. Look at New Customer Discounts before touching campaigns.
  • Rising gross and net together: you’re buying fewer first-order sales per ad dollar, or spend shifted toward retention campaigns. Check the campaign mix in your ad platforms.
  • It always reads at or below NC MER (Net) when discounts and refunds are positive, because gross sales are the larger denominator.
  • It doesn’t add up with RC MER (Gross). All three gross MERs share the same spend. When every order has a customer, 100 ÷ MER (Gross) = 100 ÷ NC MER (Gross) + 100 ÷ RC MER (Gross).

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FAQ

Gross removes your offer from the comparison. Use it to compare months or channels that ran different welcome discounts. Use the net version to judge what acquisition actually cost you.
No. Upstack divides all synced ad spend by new-customer sales. If you want spend per new customer instead, use CAC.
They share one numerator and split the denominator, so they combine through their reciprocals, not an average. Orders with no Shopify customer also count in the overall figure but in neither segment.
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