Understanding Contribution Margins and Forecasting in E-Commerce

In this episode of the Ecommerce Playbook Podcast, Richard Gaffin and Taylor Holiday dive deep into the practical use cases of Spend & aMER forecasting models—powerful tools that help brands set budgets with clarity, not guesswork.

Taylor walks through real examples, showing how these models adjust for changing costs (like tariffs) and how gross margin shifts ripple through your entire P&L, media plan, and growth strategy. They also unpack why Black Friday/Cyber Monday cohorts often underperform long-term, and how understanding lifetime value can help you spend smarter, not harder.

You’ll learn:

• Why changing gross margins completely alter your revenue potential

• How to reset budgets when tariffs or duties impact COGS

• The surprising long-term weakness of Black Friday customer cohorts

• How to model incremental spend and know when every new dollar turns negative

• Why forecasting isn’t about prediction—it’s about clarity and action

Show Notes: