Mini Episode: The Danger of Using a Blended ROAS Target

Episode Summary

In this mini-episode of The Free to Grow CFO Podcast, Jon Blair breaks down a common mistake he sees in DTC brand financial strategy: relying on a blended ROAS target to guide monthly ad spend. While a blended ROAS might appear to show healthy contribution margins, it can actually mask losses on new customer acquisition—especially when repeat customer revenue is propping up the numbers.

Jon walks through how to break down contribution margin by customer type and why attributing ad spend correctly is essential for truly understanding performance. This episode is a must-listen for founders who want to scale profitably and avoid misleading metrics.

Key Takeaways:

-Using a blended ROAS target can be misleading.

-It's essential to separate new and repeat customer contribution margins.

-Communicate specific targets for new customer acquisition to ad buyers.

Episode Links

Jon Blair - https://www.linkedin.com/in/jonathon-albert-blair/

Free to Grow CFO - https://freetogrowcfo.com/