Contribution Margin Formula | eCommerce 101 [Template Included]

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In this step, Eric will teach you about contribution margins for e-commerce and how to calculate them. Contribution margin is the profit margin that we ultimately want to work back from when we are thinking about optimizing an e-commerce business. Gross margin is the idea of how much profit you make at the product level, and contribution margin includes the fulfillment of the product. Finally, post marketing contribution margin is the idea that after you've delivered and produced the product, did you actually make a profit?