ROAS vs MER: Which Number Should Singapore E-Commerce Brands Optimise?
In-platform ROAS can look healthy while your bank account disagrees. Here's why blended MER and contribution margin are the numbers that actually protect profit.
If your Meta dashboard is happily reporting 4x ROAS but your accountant still looks worried, you’re not imagining the tension. The two of them are measuring completely different things — and for a growing e-commerce brand, only one of them actually pays the bills. Here’s how to tell which number to trust.
What ROAS actually measures (and where it misleads)
Return on ad spend is revenue attributed to an ad platform, divided by what you spent there. The problem is the word “attributed.” Since iOS 14, Meta and Google estimate conversions with modelling and generous attribution windows, so they tend to claim credit for sales that would have happened anyway — and for the same sale twice across channels.
Add rising CAC and marketplace commissions, and a “4x ROAS” campaign can still lose money once you subtract product cost, shipping, fees and returns.
Why MER is the number that survives contact with reality
Marketing Efficiency Ratio (MER) is dead simple: total revenue ÷ total marketing spend, across every channel, measured against your actual backend. It doesn’t care which platform claims the sale. When MER trends up, your marketing is genuinely getting more efficient. When it drops while in-platform ROAS looks fine, you’ve found the gap attribution was hiding.
Pair MER with contribution margin per order — what’s left after cost of goods, fees and fulfilment — and you finally know whether growth is profitable or just busy.
How to put this into practice
- Track blended MER weekly against your Shopify/Woo backend, not the ad dashboards.
- Set a target MER derived from your margin, not a borrowed “good ROAS” benchmark.
- Judge each channel on incremental contribution, and be willing to cut the ones that don’t clear margin.
- Keep platform ROAS as a directional signal for optimisation — just never as your source of truth.
This is exactly how we run e-commerce and DTC accounts: reconciling platform-reported revenue against the backend, and labelling which number is which. It’s also why our paid social work optimises toward profit, not toward a flattering slide.
Want a straight read on where your margin is actually leaking? Book a free 30-min call and we’ll walk through your numbers together — no obligation.