Citable benchmarks
Average ecommerce conversion rate is often ~2–3% (varies widely by industry and traffic mix).
Source: IRP Commerce — Ecommerce Market Data (Jan 2026)
Average ecommerce cart abandonment rate is 70.19%.
Source: Baymard Institute — Cart Abandonment Rate Statistics (2024)
Key takeaways
- Gross Margin vs Net Margin for Ecommerce — focus on one metric or lever at a time; validate with data before scaling spend.
- Pair reading with free Growthegy calculators (LTV, ROAS, break-even, pricing) to turn ideas into numbers.
- Bookmark growthegy.com/tools/ and run the Profit Diagnosis when you need a prioritised roadmap.
Gross margin = (Revenue − COGS) ÷ Revenue. It measures profit after direct product costs. Net margin = (Revenue − all expenses) ÷ Revenue. Gross margin is about product and pricing; net margin is about overall business profitability. Use gross margin to compare products and set prices; use net margin to see if the business is making money after everything.
What is Gross Margin?
Gross margin is the percentage of revenue left after deducting cost of goods sold (COGS). Formula: Gross margin % = (Revenue − COGS) ÷ Revenue. It shows how much each dollar of sales contributes after direct product costs. Use our free Gross Margin Calculator and Gross Profit Calculator to model your numbers.
What is Net Margin?
Net margin (net profit margin) is the percentage of revenue left after all expenses: COGS, operating expenses, marketing, taxes, etc. It's the bottom-line profitability of the business. For Shopify stores, our Shopify Profit Margin Calculator includes fees and payment processing to get closer to net.
Why Both Matter for Ecommerce
High gross margin with high operating costs can still mean low net margin. Use gross margin to decide which products to promote, how to price, and whether unit economics work. Use net margin to see if the business is sustainable and how much you can reinvest. For product-level analysis, use our Product Profitability Analyzer and tools hub.