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Industries/ Ecommerce

DTC unit economics

The five numbers that decide whether a DTC brand grows

You measure in dollars and most marketing advice measures in impressions. These are the five numbers underneath a Shopify brand at $1M to $5M, where to find each one in your own accounts, and what it changes when it moves.

None of them are marketing metrics. They are business numbers that marketing moves, which is why reach and engagement can climb for a year while the business feels exactly the same.

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The five

01Contribution margin

02Conversion rate

03Repeat purchase rate

04Email revenue share

05Blended acquisition cost

None of them are marketing metrics

On this page

01Contribution margin

02Conversion rate

03Repeat purchase

04Email share

05Acquisition cost

06How they interact

07Where to find yours

08Questions

Read0 / 8

Contribution margin

What is left from an order after the costs that scale with it. Product cost, shipping and fulfillment, and payment processing. Not rent, not software, not salaries.

Everything downstream runs on this. It sets the return your advertising has to clear before it earns anything, it determines how much a new customer is worth, and it decides whether a discount is a promotion or a donation.

Where to find itYour P&L, per orderno useful industry average

What moves it

Pricing, product cost negotiated at volume, shipping thresholds that raise order value, and cutting the discount habit that trained your list to wait.

Conversion rate

The share of visitors who buy. It is the only number on this list that multiplies every other one, because it raises the value of traffic you have already paid for.

Half a point sounds like nothing and it is not. Going from 2 percent to 2.5 percent is 25 percent more orders on identical traffic and identical spend.

Better comparisonYour own last 12 monthscategory averages mislead

What moves it

Mobile load speed, product pages that answer the three questions someone needs before buying, checkout steps that do not exist, and photography that shows scale and use rather than the product on white.

Repeat purchase rate

The share of customers who order again. This is the number that decides how aggressive you are allowed to be about acquisition.

A brand where nobody reorders has to make money on the first order. A brand where half of customers come back within a year can afford to break even on the first one and still grow, which means it can outbid competitors for the same customer.

Depends on the productConsumable against durableno shared benchmark

What moves it

Post-purchase email that arrives before the product does, replenishment timing built around actual usage, and a product people wanted twice.

Email revenue share

The percentage of total revenue attributable to email and SMS. The cheapest revenue in the business, because the list is an asset you own and the sends cost close to nothing.

Most brands we open sit around 15 percent. Built properly it lands closer to 30. That gap is almost always missing automated flows rather than insufficient campaign volume. For a brand at $2M, the difference is roughly $300,000 a year from a channel that requires no additional ad spend to produce.

Thin against built15% against 30%checkable in your own account

What moves it

The flows that were never built, meaning browse abandonment, post-purchase, winback, replenishment, back in stock, and review requests.

Blended acquisition cost

Total marketing spend divided by total new customers, across every channel rather than per platform. Platform-reported numbers double count, because Meta and Google both claim the same order.

There is no universal benchmark for this one and anyone offering you one is guessing. What matters is the ceiling, and the ceiling comes from the first three numbers. A brand keeping $34 an order with 1.4 average orders per customer can pay about $48 to acquire one. Paying $60 is losing money slowly enough that a dashboard will not show it.

Your ceilingSet by the first threeno universal benchmark

What moves it

Everything above. Which is the point of the next section.

The part that gets missed

How they move each other

None of these sit still while you work on another one. That is the argument for running them together rather than hiring a specialist per number.

Conversion rate upBlended acquisition cost falls without touching ad spend, because the same traffic produces more customers.

Repeat rate upYour acquisition ceiling rises, because each customer is worth more orders. Suddenly the campaigns that were unprofitable are not.

Email share upBlended acquisition cost falls again, because revenue arrives that no advertising paid for.

Margin up two pointsEvery one of those changes gets easier at once.

Do it yourself

Where to find yours

Every one of these is in a tool you already pay for. None of it needs us. If you would rather not spend the afternoon, the free audit covers the ones we can see from outside, and you keep the findings either way.

Contribution margin comes out of your own cost data rather than any platform.your books

Conversion rate, and it is worth checking mobile separately since that is usually where the loss is.shopify analytics

Repeat purchase rate, measured over twelve months rather than lifetime.shopify customers

Email revenue share, attributed revenue against total revenue for the same period.klaviyo and shopify

Blended acquisition cost, total marketing spend divided by new customers. Not the platform number.shopify

Before you ask

Common questions

01Fix first

02Numbers are fine

03Time to move

04Outside the range

05Who does the work

06Account ownership

07Not ready for a retainer

Which of the five should I fix first?

Usually contribution margin, because it changes what every other number is allowed to be. After that it depends on which one is furthest from where it should be, and that is what the audit answers rather than a general rule.

What if my numbers are all roughly fine?

Then you probably do not need an agency yet, and we will say so. Brands with healthy margins, a working repeat rate, and email above 25 percent are usually better served by more of what they are already doing than by handing it to someone else.

How long before any of these move?

Email revenue share moves fastest, usually inside 30 to 45 days, because flows start sending the day they go live. Conversion rate moves with site work, so weeks to months. Repeat purchase rate is the slowest, because it needs a full purchase cycle to measure.

Do you work with brands outside $1M to $5M?

Below $1M a retainer usually is not the right call and we will say so rather than sell you one. Above $5M the work changes shape and the numbers on our pricing page stop applying, so we scope it separately.

Who actually does the work?

The same two people for the length of the engagement. Jeremy runs the relationship and the day to day, and Jimmy runs the strategy and checks the work before it goes out.

Who owns the accounts if we stop working together?

You do, in every case. We build inside your Shopify, your Klaviyo, your Meta, and your Google Ads. You add us as users and you remove us the same way.

What if we are not ready for a retainer?

There is a fixed-scope Sprint at $2,995. One channel, three to four weeks, a defined end, and a handoff report you keep. If you start a retainer within 30 days it counts as your setup fee in full, so it costs nothing to have started there.

Two business days

Get your five numbers

The audit works these out from the outside and tells you which one is furthest from where it should be. Two business days, no account access, and the findings are yours whether or not you hire us.

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