FREE TOOL
Will a Shopify project pay for itself?
Enter your traffic, conversion rate, order value, margin and a quote. See how long a conversion lift takes to repay it, and the lift you would need.
THE SHORT ANSWER
A Shopify project pays back when the extra gross profit from a conversion-rate lift covers its cost. Payback in months equals project cost divided by monthly revenue × lift × gross margin.
Calculate it for your store
IN SHORT
- A Shopify project pays back when the extra gross profit from a conversion-rate lift covers its cost: payback in months is project cost divided by (monthly revenue × lift × gross margin).
- In the worked example below, a 48,000 project on a store making 200,000 a month repays in 6.0 months at a 10% lift and 40% margin. Those figures are illustrative, not a benchmark.
- Use gross profit, not revenue: on the same example, revenue says 2.4 months and profit says 6.0.
- The most useful output is the lift needed to repay the project in twelve months. If that figure looks implausible for your store, the scope is too big.
- The calculator uses only the numbers you enter and has no benchmark for what a lift should be. Nothing you type is sent anywhere or stored.
A worked example
Illustrative figures, not a benchmark and not a Lucent client. Computed with the same maths as the calculator.
- Monthly sessions
- 100,000
- Conversion rate
- 2%
- Average order value
- 100
- Revenue today, per month
- 200,000
- Added revenue at a 10% lift
- 20,000
- Added gross profit at 40% margin
- 8,000
- Project cost
- 48,000
- Payback
- 6.0 months
- Lift needed to repay in 12 months
- 5.0%
Why profit, not revenue
| Measured on revenue | Measured on gross profitUSUALLY THIS | |
|---|---|---|
| Added per month | 20,000 | 8,000 |
| Payback on a 48,000 project | 2.4 months | 6.0 months |
| What it ignores | Product, shipping and fees on the extra orders | Ongoing costs and seasonality |
The terms, defined
Payback period
The number of months of added gross profit it takes to equal what the project cost. It says nothing about profit after that point.
Relative lift
The percentage change in the conversion rate itself, not a change in percentage points. A 10% lift moves 2.0% to 2.2%.
Gross margin
The share of each order left after the cost of the goods sold, as a percentage. Use the margin on the orders the lift would add.
How it is worked out
Four steps, all of them arithmetic you can check by hand.
- 01
Work out monthly revenue
Multiply monthly sessions by conversion rate by average order value. This is what the store makes today.
- 02
Apply the lift
Multiply that revenue by the relative lift you assume. A 2% conversion rate with a 10% lift becomes 2.2%, not 12%.
- 03
Convert it to profit
Multiply the added revenue by your gross margin. Only the margin repays a project, because extra orders cost you product, shipping and fees.
- 04
Divide the cost by it
Project cost divided by added monthly gross profit is the payback in months. The lift needed is the cost divided by a year of your current gross profit.
Questions about the calculator
How do you calculate the payback period for a Shopify redesign or migration?
Divide the project cost by the added monthly gross profit. Added monthly gross profit is monthly revenue, times the relative conversion-rate lift, times gross margin. For example, 200,000 a month with a 10% lift at 40% margin adds 8,000 a month, so a 48,000 project repays in 6.0 months.
What conversion-rate lift should I assume for a Shopify project?
There is no honest universal number, so the calculator has no default. Try a low, a middle and a high figure, then read the "lift needed for 12 months" result: it tells you what the project has to deliver, which you can compare with what the change plausibly affects on your store.
Is the lift a relative change or percentage points?
It is a relative change. A 10% lift on a 2.0% conversion rate gives 2.2%, which is 0.2 percentage points. Entering 10 as if it were 10 percentage points would overstate the result by a factor of five.
Why does the payback calculator use gross margin instead of revenue?
Extra orders cost you the product, shipping and fees, so only the margin left after those repays the project. Payback measured on revenue looks faster than it is: in the worked example it is 2.4 months on revenue and 6.0 months on gross profit.
Does the calculator include ongoing costs such as apps or a retainer?
No. It treats the project cost as a one-time figure. If a build adds a monthly cost, subtract it from the added monthly profit by hand, or add a year of it to the project cost.
Is the payback result a forecast?
No. It is arithmetic on your assumptions. It shows what has to be true for a project to pay for itself, not whether it will, and it ignores seasonality, traffic changes and the time before the lift starts.
What does "lift needed for 12 months" mean?
It is the relative conversion-rate lift at which twelve months of added gross profit exactly equals the project cost. It does not depend on the lift you assumed, so it is the fairest single number to judge a quote by.
Does Lucent Commerce store the numbers I enter?
No. The calculation runs in your browser. Nothing you type is sent to a server or saved.
Where this fits
The calculator tells you what a project has to deliver. These are the places we work out whether it can.
Shopify conversion rate optimization
The program that tests and ships the lift.
UX and checkout audit
Where the conversion is leaking, before you commit to a build.
How we price
What drives cost, so the figure you enter is realistic.
Free store audit
A prioritized list of fixes, some of which you can do yourself.