Skip to main content

Marketing Profit Ratio (MPR)

How the Marketing Profit Ratio is defined and calculated

Written by Michael Stenger

How much of your fulfillment margin each marketing Euro/Dollar generates.


Formula

Marketing Profit Ratio (MPR) = Contribution Margin 2 / Marketing Costs

Explanation

MPR tells you how much CM2 — your margin after COGS, logistics, and transaction costs — you generate for each Euro/Dollar spent on marketing. Unlike MER, which is based on gross revenue, MPR is profit-aware: it only counts the margin actually left after fulfillment costs. An MPR above 1 means your marketing is generating more contribution margin than it costs.

Use MPR when you want a more accurate picture of marketing efficiency than MER provides — especially if your logistics or transaction costs are significant.

Notes

MPR > 1 = marketing is profitable at the CM2 level. MPR < 1 = marketing spend exceeds the CM2 it generates.

Used in the following reports

Did this answer your question?