Metrics
MER (Marketing Efficiency Ratio)
Marketing efficiency ratio is total business revenue divided by total marketing spend across all channels, measured without platform attribution.
In practice
Every platform reports its own ROAS using its own attribution, and the sum of those claims routinely exceeds the revenue in the bank. MER ignores attribution entirely: take all revenue for a period, divide by all ad spend, and you have a number no platform can inflate.
MER is a guardrail. If platform ROAS on Google and Meta both rise while MER falls, the platforms are claiming credit for each other's conversions or for organic sales. If MER rises while platform ROAS is flat, the ads are creating demand the platforms cannot see. Read over months, it is the honest trend line of whether marketing is getting more efficient.
It is not a diagnostic tool; it cannot tell you which campaign to fix. Use platform metrics for decisions inside a channel and MER to judge whether the whole budget is working. Many mature e-commerce brands set targets on both.
Why it matters
It is the only efficiency number that cannot be inflated by attribution.
RELATED TERMS
ROAS (Return on Ad Spend)
ROAS is revenue attributed to advertising divided by the cost of that advertising, expressed as a multiple such as 5x or a percentage such as 500%.
Attribution Model
An attribution model is the rule set that decides how credit for a conversion is divided among the ad interactions that preceded it, such as last click, first click, or data-driven.
Data-Driven Attribution (DDA)
Data-driven attribution is Google's model that assigns conversion credit across ad interactions using machine learning on your account's actual conversion paths, rather than a fixed rule like last click.
Written by Ilya Bulychev, Founder, Live PPC Ads. Part of the PPC Glossary.
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