Set your target MER band

The Target MER band is three optional numbers that decide when the Marketing efficiency ratio tile in your Growth Engine turns red, green or yellow. You set them from your own margins, because there is no efficiency figure that is right for every brand. Leave all three blank and MarginOS uses a target of 4.0 with a healthy range of 3.0 to 5.0. The band changes the colour of the tile and nothing else — it never moves the number itself.

What the Target MER band is

MER, the Marketing Efficiency Ratio, is revenue per advertising dollar. A MER of 4.0 means every $1 you spent on ads came alongside $4 of revenue. MarginOS computes it from your connected ad spend and your order data; how MarginOS calculates MER covers the measurement itself.

The band is the other half: your judgement about what counts as good. It lives at the bottom of the Marketing & Customer Acquisition card in Account Setup, under the heading Target MER (Marketing Efficiency Ratio), and it is three numbers — a target, a healthy floor and a healthy ceiling.

This matters because MER is not comparable between brands. A business running 70% gross margins can be comfortably profitable at a MER a thin-margin brand would be losing money at. A benchmark number from a blog post is someone else’s economics. The on-screen default band exists so the tile is not blank on day one, not because 4.0 is correct for you.

The band is read fresh every time the Growth Engine loads, so it colours the tile and never touches the calculation behind it. Change your band and the number stays exactly where it was; only the verdict moves.

Before you start

• You need admin access. Account Setup shows a permissions notice instead of the configuration screen if your user is not an admin on the workspace.
• Connect at least one ad platform first. With no recorded ad spend there is nothing to divide by, and the tile reads N/A regardless of what you set here. See connect Google Ads and connect Meta Ads.
• Know your gross margin. It is the single biggest input into what a sensible band looks like for you, and MarginOS deliberately does not guess it on your behalf.
• These are not the same as your CAC baselines. Average CAC, monthly spend and payback target sit higher up the same card and do different jobs — see set your CAC and marketing-spend baselines.

Set your target MER band in four steps

1. Open Account Setup. Click Settings in the left sidebar, then the Business Profile tab, then Marketing in the section list. The direct route is /business-config/business-profile/marketing.
2. Scroll to Target MER (Marketing Efficiency Ratio). It is the last block inside the Marketing & Customer Acquisition card, below the Primary Sales / Traffic Channel selector, separated by a divider line.
3. Fill in the three boxes. Target MER, Healthy band min and Healthy band max all accept decimals in steps of 0.1. Filling in some and not others is allowed — anything left blank falls back to its default. The on-screen note reads Leave blank to use the default (4.0, healthy 3.0–5.0).
4. Click Save Configuration. The button sits at the bottom of the Business Profile tab and saves every section on it at once, not just this card.

What each field means

Field	What it does	Default when blank
Target MER Your goal revenue per ad dollar.	Prints as the Target figure under the tile. It is a label, not a threshold — the colour is not derived from it.	4.0
Healthy band min Below this turns the tile red.	The floor of acceptable. A live MER under this number is flagged red: your advertising is costing too much for the revenue it brings.	3.0
Healthy band max Above this turns the tile yellow.	The ceiling of acceptable. A live MER over this number is flagged yellow, not green — see the question on that below.	5.0

How MarginOS uses the band

One tile reads this band: Marketing efficiency ratio, in the Snapshot strip at the top of the Growth Engine. Read the Growth Engine covers the rest of that screen.

Where your MER lands	Tile colour	What it is telling you
Below your healthy minimum	Red	Advertising is too expensive for the revenue it returns. Look at cost per acquisition before you scale spend.
Inside the band	Green	You are where you decided you wanted to be.
Above your healthy maximum	Yellow	More efficient than your own target, which usually means under-investing rather than winning.
No ad spend in the window	Neutral, value reads N/A	Nothing to divide by. MarginOS shows N/A rather than a number it cannot evidence.

Four things are worth knowing about how the band behaves:

• The target number colours nothing. Only the minimum and maximum select the colour. You can set a target of 4.0 with a band of 2.0 to 8.0 and the tile will be green across a very wide range.
• A band that does not make sense is ignored. Saving a maximum below your minimum is refused outright with the message Max MER must be ≥ min MER. Blank, zero and negative values are treated as unset, and an inconsistent band that somehow reaches storage falls back to the default range rather than breaking the tile.
• The tile tells you whose band it is. The line under the value reads default for most DTC brands while you have set nothing, and Your set target (Settings → Marketing) once you have. If you are not sure whether your change saved, that line is the answer.
• It applies on the next load. The band is resolved when the Growth Engine asks for its numbers, so there is no rebuild and no waiting. Reload the page and the colour is current. The MER value itself is served from recently computed metrics and can lag slightly behind a brand new order.

Two scope limits apply to the number this band is judging. Growth Engine metrics cover DTC orders only — wholesale, marketplace and retail lines are excluded from the Snapshot strip. And the ratio compares revenue from the channels that actually carried ad spend against that spend, so a large organic month does not inflate the tile into meaninglessness. Which orders count as which channel is covered in how MarginOS assigns each order to a channel.

Example

A supplements brand runs a 42% gross margin. At the default band, a MER of 3.4 would show green — but at 42% margin, $3.40 of revenue per ad dollar leaves roughly $1.43 of gross profit against $1.00 of spend, before fulfilment, payment fees and returns. That is not a healthy business; it just looks like one on a default band.

The operator sets Target MER 5.0, Healthy band min 4.5, Healthy band max 7.5. The MER number does not move — it is still 3.4 — but the tile turns red, and the line beneath it now reads Target 5.0x · Your set target (Settings → Marketing). The picture did not change. The standard it is being held to did.

Three months later the same brand sees a MER of 8.1. That is above the ceiling, so the tile is yellow rather than green. Revenue is arriving largely without advertising, which usually means there is profitable demand going unbought. The right follow-up is channel LTGP:CAC, which answers whether more spend would still pay for itself.

Common questions

What happens if I leave all three boxes blank?

You get the default band: target 4.0, healthy from 3.0 to 5.0, and the tile says default for most DTC brands underneath. That is a reasonable starting point for a typical DTC gross margin and a poor one for an unusual margin in either direction. Blank is a valid answer, not an unfinished one — but it is worth revisiting once you know your margin.

Why is my MER tile grey and showing N/A?

There was no advertising spend recorded in the selected window, so there is nothing to divide by. Check that your ad platform is connected and syncing, and that the window you are looking at actually contains spend. MarginOS will not show a made-up number in place of missing data — see why MarginOS shows N/A instead of a guess.

Why will it not save my band?

Almost always because the healthy maximum is below the healthy minimum. The form blocks it with Max MER must be ≥ min MER and the same rule is enforced again when the change reaches the server, so it cannot be worked around. Check that you have not swapped the two boxes.

Does changing the band change my MER number?

No. The number is calculated from your revenue and your ad spend and knows nothing about your band. The band decides only whether that number is presented as red, green or yellow. If your MER moved, something in your data moved.

Why is a MER above my band yellow rather than green?

Because unusually high efficiency is normally a symptom of under-spending. If revenue is arriving with very little advertising behind it, there is often demand you could profitably buy and are not buying. Yellow is a prompt to check whether you should be spending more, not a warning that something is broken.

Do I set the band from a benchmark I read somewhere?

No. Set it from your own gross margin and your own cost structure. Published MER benchmarks are averages across businesses whose margins you do not know, which is precisely the information that determines the right answer. That is why MarginOS asks you for a band instead of shipping a universal one.

How soon does a new band show up on the tile?

On the next load of the Growth Engine. There is no recalculation to wait for, because the band is applied when the screen asks for its figures rather than being baked into stored metrics.

Do I need admin access to change this?

Yes. Account Setup shows a permissions notice instead of the configuration screen for non-admin users, and asks you to contact your workspace administrator.

Related

• How MarginOS calculates MER — the measurement this band judges, and how it differs from ROAS.
• Read the Growth Engine — the screen the tile lives on.
• Set your CAC and marketing-spend baselines — the other marketing inputs on the same card.
• How MarginOS calculates channel LTGP:CAC — the profit-based check to run when MER sits above your band.
• How MarginOS calculates Blended CAC — the cost side of the same question.
• What MarginOS assumes before you change anything — every default MarginOS ships with, in one place.