How to Calculate Marketing Efficiency Ratio (MER) in WooCommerce

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As an ecommerce store owner, you know that measuring your marketing efforts' effectiveness is critical to your success. One of the essential metrics you must track is Marketing Efficiency Ratio (MER). In this article, we'll dive deep into MER, its importance for your WooCommerce store, and how to calculate it step-by-step. We'll also share tips to improve your MER, so let's get started!

Understanding Marketing Efficiency Ratio (MER)

Marketing efficiency ratio (MER) is the measure of how much revenue is generated from each marketing dollar invested in your WooCommerce store. It's the percentage of revenue generated per dollar spent on marketing. A high MER indicates that your marketing strategies are effective in generating revenue, while a low MER means that your marketing efforts are not generating the desired results.

What is Marketing Efficiency Ratio (MER)?

MER is a critical metric because it helps you understand the effectiveness of your marketing campaigns, identify areas for improvement, and make data-driven decisions to optimize your marketing strategies.

For example, let's say you invest $100 in a Facebook advertising campaign, and it generates $500 in revenue. Your MER for that campaign would be 500%, which is calculated by dividing the revenue generated ($500) by the marketing dollars invested ($100) and multiplying by 100.

By tracking your MER for each marketing campaign, you can identify which campaigns are generating the highest return on investment (ROI) and adjust your marketing budget accordingly. This will help you maximize your revenue and minimize your marketing expenses.

Why is MER important for your WooCommerce store?

MER is essential because it helps you identify which marketing campaigns are generating the most revenue for your WooCommerce store. Knowing this information will enable you to allocate your marketing budget more effectively, invest more in successful campaigns, and reduce spending on less effective campaigns.

For example, if you have two marketing campaigns running simultaneously, and one has an MER of 500% while the other has an MER of 200%, you know that the first campaign is generating more revenue per dollar spent. You can then allocate more of your marketing budget to that campaign to maximize your revenue.

Additionally, tracking your MER over time can help you identify trends in your marketing performance. For example, if you notice that your MER is consistently decreasing over time, it may be a sign that your marketing strategies need to be adjusted to better align with your target audience.

In conclusion, understanding and tracking your MER is essential for optimizing your marketing strategies and maximizing your revenue. By analyzing your MER for each marketing campaign, you can make data-driven decisions about where to allocate your marketing budget and adjust your strategies for optimal performance.

Setting up WooCommerce for MER calculation

Before you can calculate your MER, you must set up your WooCommerce store correctly. Here's how:

Installing necessary plugins and tools

One of the best ways to calculate your MER accurately is to use an analytics tool like Google Analytics. This will help you track important data about your website visitors, including where they are coming from, what pages they are visiting, and what actions they are taking on your site. With this information, you can make informed decisions about how to improve your website and increase sales.

In addition to Google Analytics, there are several plugins and tools you can use to integrate analytics with your store and track your campaigns' performance effectively. For example, the WooCommerce Google Analytics Integration plugin allows you to easily connect your store to Google Analytics and track important ecommerce metrics like revenue, conversion rate, and average order value.

Another popular analytics plugin is MonsterInsights, which provides detailed insights into your website traffic and ecommerce performance. With MonsterInsights, you can track important metrics like product views, add to carts, and purchases, as well as see which marketing channels are driving the most traffic and sales to your store.

Configuring your WooCommerce store for accurate data tracking

To accurately track data for MER calculation, you must configure your store to track relevant data. This includes enabling ecommerce tracking in Google Analytics, setting up conversion goals to track specific actions like product purchases or lead captures, and tracking your campaigns' performance against these goals.

Enabling ecommerce tracking in Google Analytics is essential for accurately tracking your store's performance. This will allow you to see important metrics like revenue, conversion rate, and average order value, as well as track which products and categories are performing the best.

Setting up conversion goals in Google Analytics is also important for tracking specific actions on your site, such as product purchases or lead captures. By setting up goals, you can see which marketing campaigns and channels are driving the most conversions, and optimize your marketing efforts accordingly.

Finally, tracking your campaigns' performance against these goals is crucial for improving your marketing ROI and increasing sales. By regularly monitoring your campaigns' performance, you can identify areas for improvement and make data-driven decisions about how to optimize your marketing efforts.

By following these steps and using the right tools, you can set up your WooCommerce store for accurate MER calculation and make informed decisions about how to improve your ecommerce performance.

Gathering data for MER calculation

Before you can calculate your MER, you must collect specific data related to your marketing campaigns.

Identifying relevant marketing costs

The first step is to identify all the costs associated with your marketing campaigns. This includes advertising costs, content creation costs, affiliate commission costs, and any other expenses related to promoting your products or services.

Tracking revenue generated from marketing efforts

Next, you need to track the revenue generated from each marketing campaign. This includes revenue from new customers and repeat customers who made purchases through your marketing campaigns.

Monitoring customer acquisition and retention metrics

It's also essential to track customer acquisition and retention metrics to calculate your MER accurately. This includes tracking the number of new customers acquired through each campaign and the percentage of existing customers that were retained.

Calculating Marketing Efficiency Ratio (MER)

Once you have collected all the relevant data, you can start calculating your MER.

Step-by-step guide to calculating MER

The formula for calculating MER is simple:

  1. Divide the revenue generated from a marketing campaign by the total cost of the campaign
  2. Multiply the result by 100 to get the MER in percentage

For example, if a campaign generated $10,000 in revenue and cost $2,000, the MER is:

  1. $10,000 / $2,000 = 5
  2. 5 x 100 = 500%

Interpreting your MER results

An MER of more than 100% indicates that your marketing campaign generated more revenue than it cost. In contrast, an MER of less than 100% means your campaign cost more than the revenue it generated. It's essential to compare your MER with industry benchmarks and your previous campaigns' results to make informed decisions.

Tips for improving your WooCommerce store's MER

Now that you know how to calculate your MER, you can take steps to improve it. Here are some tips:

Optimizing marketing campaigns

Identify the campaigns with the highest and lowest MERs and optimize them accordingly. You can adjust your targeting, messaging, or visuals to improve your campaigns' performance.

Enhancing customer experience and retention

Improving the customer experience and retention rate will help increase your revenue and lower your marketing costs. Focus on providing excellent customer service, offering loyalty programs, and upselling and cross-selling to increase your revenue per customer.

Utilizing data-driven decision-making

Use data to make informed decisions and adjust your marketing strategies accordingly. Test different tactics and measure results to find what works best for your WooCommerce store.


Marketing Efficiency Ratio (MER) is a critical metric that measures the effectiveness of your marketing campaigns. By tracking and optimizing your MER, you can allocate your marketing budget effectively, reduce inefficiencies, and increase revenue for your WooCommerce store.

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