Finance metric

Contribution margin after marketing

The share of your net revenue left after every cost of selling one more unit, ad spend included.

1. 1

   1 · How we calculate it

   Net revenue minus variable costs and ad spend, over net revenue.

   Contribution margin=Net revenue − variable costs − ad spend÷Net revenue

   From your net revenue we subtract cost of goods, channel fees, fulfillment, storage and ad spend. Then we divide by net revenue.

   It covers the last 12 complete months.

2. 2

   2 · Where the data comes from

   It needs 5 kinds of data, each from a system you connect.

   Data	From
   Orders and refunds on every sales channel	Shopify, Amazon Seller Central, TikTok Shop
   Landed cost per unit	Shopify, QuickBooks, Xero
   Channel fees	Shopify, Amazon Seller Central, TikTok Shop, QuickBooks, Xero
   Fulfillment costs	Amazon Seller Central, QuickBooks, Xero, ShipHero
   Spend on every ad platform	Amazon Ads, Meta Ads, Google Ads

3. 3

   3 · What we compare it with

   Brands with 7- and 8-figure sales have a median of about 25%.

   25%Median · Finaloop

   Finaloop gives this median from the books it keeps for hundreds of these brands.¹ Its definition is close to ours.

   Their definition	They subtract every variable cost and the ad spend, but not fixed marketing fees such as agency retainers. They don’t name storage.
   Their period	Their data covers 2023 to 2025. The article doesn’t say which months the median covers.
   Who they count	Hundreds of brands whose books Finaloop keeps.

   25% medianNorthwind Pet Co · 18%

   0%30%

   Below their median

   Finaloop, Mar 1, 2026 →