Six New Numbers – 1
The current eCommerce analytics landscape is cluttered with dozens of metrics that create data overload without driving strategic action. Most businesses diligently track conversion rates, AOV, traffic sources, and ROAS—yet still struggle with profitability. This disconnect exists because traditional metrics focus on transactions rather than customer relationships, campaign performance rather than structural efficiency, and short-term revenue rather than sustainable profit.
The six numbers I propose represent a paradigm shift. They serve as second-order metrics—measures that derive their power not from tracking isolated activities but from revealing the systemic health and efficiency of your entire business model. Each addresses a critical blind spot in conventional eCommerce analytics. Together, they form a nice acronym: EAGLES.
- Earned Growth – This metric serves as the perfect starting point since it directly measures the core NeoMarketing principle of building value from existing relationships rather than constant acquisition. It sets the philosophical foundation for everything that follows.
- AdWaste Percentage – Following Earned Growth, AdWaste creates the natural counterpoint – showing what happens when retention fails. This creates the immediate tension and business case for change.
- Growth & Profit Balance (Rule of 40) – After establishing the retention-acquisition balance, this metric naturally extends the discussion to the broader business balancing act between growth speed and profitability.
- LTV/CAC Ratio – This metric then provides the economic engine that powers both growth and profitability, connecting the macro business measures to the unit economics.
- Existing Revenue Ratio – The percentage of revenue from existing customers serves as the operational bridge that connects strategic metrics to day-to-day business reality.
- Segmentation Balance (BRTN Split) – Finally, the BRTN framework provides the actionable implementation path – the “how” that brings all the previous metrics to life through specific customer strategies.
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- Earned Growth: The Quality of Revenue
Earned Growth measures the percentage of your revenue that comes from existing customers and their referrals rather than paid acquisition. First popularised by Fred Reichheld, this metric distinguishes between “bought” growth (expensive and often unsustainable) and “earned” growth (organic and highly profitable).
From an earlier essay: “Earned Growth is mathematically represented as Net Revenue Retention + Earned New Customers (ENC) – 100. Reichheld, Darnell and Burns discuss this in an article in Harvard Business Review: “Once you have organized revenues by customer, you can determine your NRR. Simply tally this year’s revenues from customers who were with you last year, divide that amount by last year’s total revenues, and express that figure as a percentage. ENC is the percentage of spending from new customers you’ve earned through referrals (as opposed to bought through promotional channels).” They offer an example: “Company A’s revenues grew from $100 in 2020 to $130 during 2021, or 30%. In 2021 customers who were on the books in 2020 accounted for $85 of revenues. Some of them expanded their purchases by a total of $5, but that growth was more than offset by other customers who reduced purchases by a total of $20, resulting in an NRR of 85%. New customers accounted for $45 in revenues—$25 from earned new customers (referrals) and $20 from bought new customers. Adding the NRR (85%) and ENC (25%) and then subtracting 100% results in a 10% earned growth rate.””
The brilliance of Earned Growth as a metric lies in its simplicity and its power as a predictor. Companies with high Earned Growth percentages typically outperform their competitors in profitability and show more resilient growth during economic downturns. It serves as an indirect measure of customer satisfaction—people who return and refer others are demonstrating their approval more meaningfully than any survey response.
For eCommerce businesses, tracking Earned Growth creates a crucial shift in mindset. Rather than celebrating all revenue equally, it distinguishes between revenue that strengthens your economic engine and revenue that merely keeps it running at considerable cost. A business with a high Earned Growth operates fundamentally differently than one with a low Earned Growth, even if their top-line numbers look identical.
- AdWaste Percentage: Marketing’s Hidden Profit Leak
AdWaste represents perhaps the largest overlooked opportunity in modern eCommerce. This metric—the percentage of your marketing budget spent reacquiring customers who already exist in your database—typically reveals that 60-70% of acquisition spending is effectively wasted.
This waste occurs through three primary mechanisms:
- Retargeting existing customers through expensive platforms
- Paying to acquire “ghost users” who never provide identifiable information
- Failing to activate newly acquired customers, necessitating reacquisition
What makes AdWaste particularly valuable as a metric is its direct connection to profit improvement. Unlike incremental optimisations of click-through rates or cost-per-click, reducing AdWaste delivers bottom-line impact at scale. Each percentage point of reduction flows directly to increased profitability.
Most importantly, AdWaste identifies a structural inefficiency rather than a campaign-level problem. By highlighting the systemic disconnect between acquisition and retention strategies, it forces organisations to bridge their marketing silos and create more coherent customer journeys.
