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Returning Customer MER is your total ad spend as a percentage of revenue from repeat orders. Read it next to New Customer MER: together they show whether your blended MER is being carried by acquisition or by customers you already have.

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Formula

RC MER = ( Total Ad Spend ÷ Returning Customer Total Revenue ) × 100

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Formula Components

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How it works

Upstack splits Shopify orders into first orders and repeat orders using the customer on each order. A customer’s earliest non-cancelled order in your store is their first order. Every later order is a repeat order and feeds this metric. Orders with no Shopify customer are in neither segment. The spend side doesn’t split. RC MER, NC MER and MER all divide the same total ad spend. That has two consequences:
  • RC MER is lower than NC MER exactly when repeat revenue is larger than first-order revenue. It says nothing about which customers were cheaper to reach.
  • The segments combine through reciprocals: 100 ÷ MER = 100 ÷ NC MER + 100 ÷ RC MER, when every order has a customer.

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Example

A home fragrance brand holds ad spend at $120,000 per quarter. Blended MER looks stable: MER barely moved. Underneath, the same budget bought $40,000 less first-order revenue in Q2, and repeat revenue grew enough to hide it. If the brand only watched MER, it would miss that acquisition got about 16% less efficient (41.38% to 48.00%).

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How to interpret it

  • Use it to explain MER moves. When MER changes, check which of NC MER and RC MER changed with it.
  • A falling RC MER is good news about retention, not about ads. It means repeat revenue grew faster than total spend.
  • Totals include shipping and tax. If returning customers more often clear a free-shipping threshold than new ones, the shipping share differs between segments. RC MER (Gross) and RC MER (Net) use product sales only.
  • Refunds don’t reduce it. Repeat-order refunds show up in the net version.

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FAQ

Because repeat orders bring in more revenue than first orders over the same dates, and both metrics divide the same spend. A brand with a large subscriber base will see a low RC MER even if it runs almost no retention ads.
Not in this metric. Upstack doesn’t divide spend by audience. Platform reports can split campaigns by audience if you need that view.
Total matches the revenue you’d report as sales. Gross removes loyalty discounts from the picture. Net is closest to what you kept after discounts and refunds.
See all Performance metrics →