Lara GuevaraSupply Chain expert (Product and Service)

Use contribution margin data instead of gross margin

5 Feb 2026 · 1 min

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1:00

A high ROAS can mask losses if you don't know contribution margin. A product with 12% CM and 4x ROAS loses money per sale, while one with 30% CM and 2.5x ROAS actually profits. Ask finance for CM by SKU, not gross margin, to spend smarter.

Chapters

Your marketing team is pushing your worst margin product and they don't even know it. Marketing optimizes for ROAS and conversion, but a 4x ROAS on a 12% CM product is worse than 2.5x ROAS on a 30% CM product. The math doesn't lie. Let me show you. Product A Low cm, every sale loses money even with good roas. Product B High cm, every sale contributes profit even with worse roas. The point Marketing needs contribution margin data. Not gross margin, not revenue. The actual profit per unit after all variable costs. Without it, they're optimizing in the dark, scaling products that look profitable but aren't. Share a CM by SKU with your marketing team this week. Watch how they change their decisions. So if you're in marketing, go ask finance for contribution margin data. You need it.