The Growth Library

Paid-media glossary.

Plain-English definitions for the metrics and terms that run e-commerce growth, with how each one is actually used in practice.

Acquisition

Acquisition→

CPA

Cost Per Acquisition — the spend required to produce one conversion event, usually a purchase or a lead. CPA rises predictably as you scale up-funnel, so we set a CPA ceiling per channel rather than chasing a single target.

Acquisition→

CAC

Customer Acquisition Cost — the marketing spend required to acquire a new customer. Healthy CAC is judged relative to LTV: a 3:1 LTV-to-CAC ratio is a common benchmark, but the right target depends on margin and payback period.

Acquisition→

CPM

Cost Per Mille — the cost of one thousand ad impressions. CPM rises in competitive windows like Q4 and during auctions for premium audiences; it's the lever that determines how efficiently you can reach a given audience before any creative work matters.

Acquisition→

ROAS

Return on Ad Spend — the revenue attributed to an ad channel divided by the spend on that channel. Platform-reported ROAS is inflated by attribution defaults, so we read it alongside blended ROAS and MER.

Acquisition→

Lookalike Audience

A modeled audience a platform builds from a seed list, finding new people who resemble existing customers. Lookalike quality is determined almost entirely by the seed — a high-value seed outperforms a broad one.

Retention

Retention→

LTV

Lifetime Value — the total profit a customer is expected to generate across their relationship with the brand. We model it from repeat purchase rate and average order value, and use it to set an affordable CAC.

Retention→

AOV

Average Order Value — the mean revenue per order. Lifting AOV through bundling, free-shipping thresholds, or post-purchase cross-sell is often the cheapest way to improve ROAS without touching ad spend.

Creative

Creative→

CTR

Click-Through Rate — the share of impressions that produce a click. On paid social, CTR is primarily a creative metric: a rising CTR usually means the hook is working, while a falling one signals creative fatigue.

Creative→

UGC

User-Generated Content — video or images made by real customers rather than the brand. UGC outperforms polished brand creative for many DTC categories because it reads as social proof and matches the native feel of the feed.

Measurement

Measurement→

CVR

Conversion Rate — the share of clicks (or sessions) that produce a conversion. CVR splits the work between the ad and the landing page; a strong ad with weak CVR points you to fix the page, not the creative.

Measurement→

POAS

Profit on Ad Spend — gross profit from ad-attributed sales divided by ad spend. Unlike ROAS, it accounts for product margin, so it tells you whether scaling actually makes money rather than just moving revenue.

Measurement→

MER

Marketing Efficiency Ratio — total revenue divided by total marketing spend across all channels. Because it ignores attribution entirely, it can't be inflated by platform settings, making it the most honest top-line efficiency number.

Paid-media glossary.

CPA

CAC

CPM

ROAS

Lookalike Audience

LTV

AOV

CTR

UGC

CVR

POAS

MER

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