Ecom CFO Newsletter

Welcome to this issue of Ecom CFO Notebook – a weekly letter for 7–9 figure ecommerce founders and CFOs, sharing my perspective and stories for profitable growth.

Sam here. On a recent call with a $20M founder, I asked: “Why aren’t customers coming back?”

Silence.

This is a founder who lives in first order ROAS.
Daily calls with the marketing team.
New creatives. New offers. New spend.

But no larger retention strategy. No product roadmap.
No regard for what happens after the first order.

That’s the problem.
And it’s killing growth.

On our last financial review, we were digging into the - very few - customers who actually are purchasing after 6 months.

The phone numbers were sitting right there. I said he should call them. Right now.

I heard and felt hesitation.

Not “I don’t know who to call.”
Not “I don’t have time.”
Just discomfort.

So I said I’d call them.

And we (I) dialed 7 customers until someone picked up. This sounds insane coming from the finance guy so here is the actual screenshot from the call recording of me talking to the customer.

Founders in our industry are brilliant at building growth engines. They’re naturals at pain points, testing copy, scaling ads, and squeezing every bit of efficiency from paid acquisition.

But many don’t get close enough to the part of the business that matters most. The messy, operational, street level. The feedback. The reality of what customers are experiencing when the emails stop and the package shows up.

That’s where the answers are.
And it’s exactly where most founders stop looking.

Founders who are profitable on the first order and then keep pushing acquisition spend instead of investing in customer experience, product, and/or retention.

They don’t realize how much margin and LTV they’re leaving on the table.

We need to get back to basics and listen more to people and less to dashboards.

ROAS Isn’t the Lever — Contribution Margin Is

In our Q1 benchmark report, we saw something surprising:

ROAS was down across every cohort… 

yet contribution margin was up for most brands.

Huh?

Operators are getting smarter in areas not named “paid acquisition” - fulfillment, pricing, and GTM.

One client dropped Meta entirely and went all in on free samples. Their CM exploded to 69% in our report.

That’s extreme, but it shows how creative strategy and tight operations beat ad creative.

Even excluding outliers, we saw a wide variance. Among $10–$50M brands, contribution margin ranged from 11% to 40%.

Same revenue band. Completely different outcomes.

That’s not a media buying issue. It’s operational discipline.

How to Find Your Margin Leaks

So if ROAS is a distraction… how do you actually improve your contribution margin?

Look more inward and less outward.

One tool I’ve found incredibly helpful when we mess up at Ecom CFO is the After Action Report (AAR). I stole this from the military and made it my own.

I built it after a frustrating client miss years ago.
Now, anytime we have a big f*ck up, or we want to improve, we run one.

I would’ve told the founder from earlier to do exactly this.

He was profitable on the first order. Product costs were low enough and AOV high enough that every new customer generated margin on day one. So technically, the business “worked.”

But customers weren’t coming back. There was no strategy for retention, no communication plan, no product roadmap to extend LTV.

Instead, all the focus was on acquiring more new customers and squeezing better ROAS from the same playbook.

Here’s how a simple AAR could’ve helped reveal that blind spot:

This isn’t about overhauling the business.

It’s about asking better questions and creating the space to answer them.

If you’re profitable but CM is lagging or if you feel like your business has stopped getting more efficient, run an AAR. 

And you want help finding the gaps, grab time on my calendar and we can run through it together.

-Sam

P.S. Here’s the After Action Report template my team uses — plus a 12-page guide to help you implement it in your business.