Returning Customer CM1 MER: Repeat Order Gross Margin Efficiency

Returning Customer CM1 MER measures how much gross margin (revenue minus COGS) you generate from repeat orders per dollar of ad spend.

Formula

Returning Customer CM1 MER = Returning Customer CM1 ÷ Ad Spend

Formula Components

Metric	Definition
Returning Customer CM1	Gross margin from repeat buyer orders
Ad Spend	Total advertising spend

Metadata
Type	Ratio
Data Source	Shopify, Advertising Platforms
Aggregation	Ratio

Example

Your Shopify store generates $60,000 CM1 from returning customers and spends $15,000 on ads.

Component	Value	Calculation
Returning Customer CM1	$60,000	Repeat order gross margin
Ad Spend	$15,000	Marketing cost
Returning Customer CM1 MER	4.0	$60,000 ÷ $15,000

How It Works

Returning Customer CM1 MER shows gross margin efficiency for repeat customers. This is typically higher than New Customer CM1 MER because repeat customers don’t require acquisition costs—they’re already in your customer base.

Benchmarks

Rating	Range
Excellent	> 4.0
Good	2.5 – 4.0
Moderate	1.5 – 2.5
Concerning	< 1.5

Returning customer CM1 MER should be meaningfully higher than new customer CM1 MER.

Metric	Relationship
Returning Customer CM1	Numerator (gross margin)
CM1 MER	Overall CM1 efficiency
New Customer CM1 MER	First-order efficiency

See all Performance metrics →

​Formula

​Formula Components

​Example

​How It Works

​Benchmarks

​Related Metrics

Formula

Formula Components

Example

How It Works

Benchmarks

Related Metrics