D2C & Meta Ads metrics, in plain English
Every abbreviation that shows up in your ad account and P&L — what it means, how it's calculated, and what "good" looks like for an Indian D2C brand.
Profit & unit economics
The numbers that decide whether a product actually makes money.
The direct cost to make or source one unit — fabric, manufacturing, materials. Does not include shipping, ads or overheads.
The % of price left after COGS. Vanity-ish on its own because it ignores shipping, fees and returns.
(Price − COGS) ÷ Price
Healthy: Fashion 60–70%, jewelry 70–80%+
The real % left after ALL variable costs — COGS, shipping, packaging, payment/COD fees, GST, discounts and returns. Decides your break-even ROAS and max CAC.
(Price − all variable costs) ÷ Price
Healthy: Fashion 35–50%, jewelry 45–60%
Average revenue per order. Raising AOV (bundles, upsells) is one of the fastest ways to fix weak unit economics.
Total revenue ÷ number of orders
What's left after literally everything — COGS, returns, ads, agency, founder salary and overheads. The truest measure of a healthy brand.
Net profit ÷ net sales
Healthy: 10–20%+ is healthy for D2C
The minimum ad return you must beat to not lose money on an order.
1 ÷ contribution margin
Healthy: Lower is better — driven by fat margins
The most you can pay to acquire one customer and still break even. Equals contribution per order.
Price × contribution margin
Blended, account-wide efficiency: total revenue vs total marketing spend. A truer picture than single-channel ROAS.
Total revenue ÷ total marketing spend
Healthy: Above your break-even MER
How long (in orders or months) until a customer's profit repays what you spent to acquire them. Shorter = healthier cash flow.
Total profit a customer brings across all their orders, not just the first. High-LTV categories can afford a higher CAC.
How many rupees of lifetime value you get per rupee of acquisition cost. A core health metric for any D2C brand.
Healthy: 3:1 or higher is healthy
Advertising (Meta / Facebook)
The ad metrics that drive your CAC and decide if you can scale.
Revenue generated per rupee of ad spend. Platform ROAS only sees one channel — compare it to your break-even ROAS.
Revenue from ads ÷ ad spend
What you pay to show your ad 1,000 times. Driven by audience, competition and creative quality.
Ad spend ÷ impressions × 1000
Healthy: India fashion ₹100–250
What you pay for one click to your store.
(CPM ÷ 1000) ÷ CTR
The % of people who click after seeing your ad. A proxy for how strong your creative and hook are.
Clicks ÷ impressions
Healthy: 1–2%+ (link CTR)
The % of store visitors who buy. Driven by product, price, page quality and trust.
Orders ÷ visitors
Healthy: Optimised stores 1.5–3%
What it costs in ads to get one order (also called Cost Per Acquisition / Cost Per Purchase). Must stay below your max allowable CAC.
(CPM ÷ 1000) ÷ (CTR × CVR)
Average times each person saw your ad. Too high → fatigue, rising CPM and falling CTR.
Healthy: Watch above ~2–3 in a short window
Number of unique people who saw your ad at least once.
Total times your ad was shown (one person can count many times).
The % who watch the first 3 seconds of your video. Measures how strong your opening hook is.
Healthy: 30%+ is strong
How well your video keeps viewers watching past the hook. Drives cheaper, more efficient reach.
A mid-funnel signal — shoppers adding product to cart. Gap between ATC and purchase points to checkout/trust friction.
Shoppers who started checkout. A strong purchase-intent signal used to optimise and retarget.
Fulfilment & India-specific
The realities of Indian D2C that quietly destroy margin.
Customer pays on delivery. Dominant in India (50–70% of orders) but carries extra handling cost and far higher return/RTO risk.
Healthy: Push prepaid to cut RTO
A shipped order that comes back undelivered (refused, address issues — mostly COD). You pay both-way shipping and earn ₹0. The #1 hidden margin killer.
Healthy: Keep under ~15%
% of orders returned (customer returns + RTO). Each return costs forward + reverse shipping plus restocking loss.
Healthy: Fashion 25–40%, jewelry 10–20%
Paid online before shipping (UPI, card, netbanking). Much lower RTO than COD — incentivise it with small discounts.
The cost and process of getting returned product back. Often as expensive as forward shipping.
Indian tax on the sale. A pass-through to the government — not your margin. Apparel 5–12%, imitation jewelry ~3%.
A unique product variant (size/colour). Each SKU has its own cost, price and margin profile.
Customer & retention
Repeat buyers are where D2C brands actually get profitable.
% of customers who buy again. Higher repeat rate lifts LTV and lets you pay more to acquire.
Healthy: 20–30%+ is strong for D2C
% of customers who stop buying over a period. The opposite of retention.
Grouping customers by their first-purchase month to track how each group's spend and retention evolve over time.
A loyalty score (−100 to 100) from 'how likely are you to recommend us?'. A proxy for word-of-mouth and retention.