# What is MER (marketing efficiency ratio)?

> MER is your total revenue divided by your total ad spend. It is harder to fool than ROAS. Here is the formula, an example and when to use it.
- **Author**: Marxx
- **Published**: 2026-10-21
- **Category**: Metrics
- **URL**: https://marxx.ai/library-glossary/mer

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MER (marketing efficiency ratio) is your total revenue divided by your total ad spend, across every channel. A MER of 4 means the business made INR 4 in sales for every INR 1 it spent on ads.

## The formula

MER = total revenue / total ad spend

Total revenue comes from your store or bank, not from an ad platform. Total ad spend adds up every platform: Meta, Google (YouTube ads are bought through Google Ads), marketplaces and influencers.

## A worked example

In September your Shopify store took INR 12,00,000 in orders. You spent INR 2,00,000 on Meta and INR 1,00,000 on Google.

- Total ad spend = 2,00,000 + 1,00,000 = INR 3,00,000
- MER = 12,00,000 / 3,00,000 = **4.0**

Now look at what each platform claimed. Meta reported INR 8,00,000 in sales and Google reported INR 6,00,000. Together they claim INR 14,00,000, more than the store actually sold. Both counted some of the same buyers. MER cannot double count, because it starts from the real total.

## MER vs ROAS

| | ROAS | MER |
|---|---|---|
| Revenue source | The ad platform | Your store or finance team |
| Covers | One campaign or platform | The whole business |
| Can double count | Yes | No |
| Tells you which ad works | Yes | No |

Use both. MER tells you if marketing as a whole is paying. [ROAS](/glossary/roas) tells you which campaign to cut or grow.

## What is a good MER?

It depends on margin. A useful check: your MER should sit above your [break-even ROAS](/glossary/break-even-roas), worked out across the business. With a 50% gross margin, a MER under 2 means ads cost more than they earn.

## FAQ

### Does MER include organic sales?

Yes. That is its weakness and its strength. It shows the full return on marketing, but a viral post or a sale can lift MER without any change in ads.

### Should I include agency fees in MER?

Use media spend only, so the number stays comparable month to month. Track fees separately.

### Is MER the same as blended ROAS?

Yes, as this page defines it. Both divide total revenue by total ad spend. Some teams also count agency fees, salaries and software in the spend, so check the definition before you compare numbers ([Agile Brand Guide](https://www.agilebrandguide.com/wiki/metrics/marketing-efficiency-ratio-mer/), checked 2026-10-20).

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