Lab // Topic / 8 articles
Unit Economics and MeasurementGuides, worked examples and a calculator for this topic.
Unit economics describe what a single customer or sale earns and costs. Margin, customer acquisition cost and payback period decide how fast you can grow without running out of cash. This pillar explains each measure, how to calculate it, and which numbers to review every month.
CAC payback period: how to calculate it and what to aim for
CAC payback period is the number of months of gross profit needed to recover what you spent to win a customer.
- Unit Economics and Measurement / 1 min read
Margin vs markup for ecommerce sellers
Margin is profit divided by the selling price, while markup is profit divided by cost.
- Unit Economics and Measurement / 1 min read
How to calculate customer lifetime value with churn and discounting
Customer lifetime value is the gross profit a customer generates over their time with you, adjusted for the chance they leave each month and for the time value of money.
- Unit Economics and Measurement / 1 min read
How many SDRs do you need to reply to leads within five minutes?
The number of SDRs you need depends on peak leads per hour, the time each lead takes to handle and the reply time you want.
- Unit Economics and Measurement / 1 min read
How to find your conversion funnel bottleneck
Your funnel bottleneck is the stage where a small improvement adds the most sales.
- Unit Economics and Measurement / 1 min read
How to size an A/B test before you launch it
Size an A/B test by choosing your baseline conversion rate, the smallest lift worth detecting, a confidence level of 95 percent and a power of 80 percent.
- Unit Economics and Measurement / 1 min read
How much can you raise prices before customers notice?
Customers usually notice a price change once it passes a threshold proportional to the current price, often 5 to 10 percent.
- Unit Economics and Measurement / 1 min read
Calculating ecommerce margin in Canada after GST, HST and duties
Ecommerce margin in Canada should be calculated on the price before sales tax, after product cost, shipping, duties and payment fees.
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