SaaS Magic Number · E-commerce
SaaS Magic Number for E-commerce.
Sales efficiency: ARR added per dollar of S&M spend.
E-commerce engineered for unit economics.
Finance & Strategy · E-commerce
Why e-commerce operators use the saas magic number.
Calculate the Magic Number — net new ARR ÷ prior-quarter sales & marketing spend. Above 1.0 = invest more aggressively. Below 0.5 = pull back.
E-commerce has moved from a margin-rich category to one where unit economics decide who survives. SAZ helps DTC, B2B e-com, and marketplaces sharpen positioning, fix margins, and build the demand and retention programs that compound.
Benchmarks
What good looks like — typical ranges to compare against.
< 0.5
Inefficient — pull back
0.5–0.75
Acceptable — tighten
0.75–1.0
Healthy — keep investing
> 1.0
Elite — invest more
The formula
How saas magic number is calculated.
Magic = (Net New ARR × 4) ÷ (Prior Q S&M Spend × 4)Industry context
What changes when saas magic number is applied to e-commerce.
Unit economics, CAC, and LTV
Site, funnel, and merchandising
Lifecycle and retention
Fulfillment and ops
Run the numbers
Open the saas magic number.
Free, instant, no signup.
SaaS Magic Number · E-commerce
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