How is revenue calculated?+
Revenue = Purchases x Average Order Value. Purchases include repeat purchases — if you make 168 initial purchases and have a 25% repeat rate, you get an additional 42 orders. This gives you gross revenue before costs.
What's the difference between ROI and ROAS?+
ROAS is Revenue / Ad Spend. It tells you how much revenue each dollar of ad spend generates. ROI is (Profit - Total Costs) / Total Costs. It tells you your actual return after accounting for product costs, not just ad spend. A 4x ROAS can still mean negative ROI if your margins are thin. ROAS is a vanity metric without context. ROI is the truth.
How does the funnel math work?+
Sessions = Ad Spend / CPC. Add to Carts = Sessions x ATC Rate. Checkouts = Add to Carts x Checkout Rate. Purchases = Checkouts x Purchase Rate. Each step is a multiplier — a small improvement at any stage compounds through the entire funnel. Going from 15% to 18% ATC rate can be worth more than a 20% budget increase.
What does Cost of Goods include?+
COGS percentage should include your product cost, packaging, and fulfillment — everything it costs to deliver the product before marketing. If your product costs $20 and you sell for $85, that's about 24%. Most eCommerce brands run 30-50% COGS. If you're above 50%, your margin math gets very tight at scale.
Why include repeat purchase rate?+
Because your CPA only tells half the story. If 25% of customers buy again within 60 days, your real cost per customer drops significantly. A $30 CPA with a 25% repeat rate effectively becomes $24 per customer over 60 days. Brands that ignore LTV set CPA targets that are too conservative and leave scale on the table.
What's a good ROAS for eCommerce?+
It depends entirely on your margins. A brand with 70% margins can scale profitably at 2x ROAS. A brand with 30% margins needs 4x+ just to break even. Stop comparing your ROAS to benchmarks. Calculate your breakeven ROAS (1 / gross margin %), then build from there. Everything above breakeven is profit.
