Just about every brand rallies around on thing as their north star: revenue.

Bonuses, board decks, budgets, etc - it all moves based on revenue. And most people never question it. Of course you optimize for revenue, it's the top line of the business, right?

Well, actually no. As Chubbies co-founder Preston Rutherford told us, "Revenue is a vanity metric. It's not representative of success. It's sort of the opposite of that."

It might sound strange, but consider the source: he built a brand through a full cycle — founding, scaling, and selling Chubbies for north of $100M — so he has the benefit of hindsight that few others do.

His argument is specific, it's mechanical, and if you sit with it, it changes how you'd structure the next year of your business.

Read on, dig into the details, and be sure to check out Preston’s new company Marathon Data, a brand marketing measurement platform.

What’s wrong with optimizing for revenue? A lot, it turns out.

Preston's starting point is that every marketing action you take is buying something.

You might be paying with time, headcount or dollars - but nothing is free. And the question is what you're actually getting for the spend.

And as Preston points out, when you’re overly focused on revenue, you can’t evaluate the return on your marketing spend. You’re putting dollars in, but you don’t REALLY know what you’re getting back.

This is exactly where most brands get in trouble. As a few specific examples:

Product-level margin variance

In an apparel business with many SKUs, the blended margin assumption most brands operate on is almost always wrong:

• You launch an upmarket product on a smaller run, and the per-unit cost blows up
• A port strike forces you to air-freight
• You extend into a new category that doesn’t follow your typical AOV assumptions
• etc etc

Any one of these events throws the unit economic model off, but you won’t know it if you’re focusing on revenue alone.

Sale collections silently poisoning your paid social

Preston described a scenario that will feel painfully familiar to many:

A sale collection goes live, is supposedly only available to existing customers, and somehow the Facebook pixel starts firing on that URL pattern.

The platform sees a spike in conversions and tells you to spend more, you do it, and now you're now paying to drive traffic to products at liquidation prices.

Your profit is getting eroded on both sides of the transaction, but according to the dashboard it’s working - because it’s only looking at revenue.

The team-wide incentive problem.

This one is particularly insidious, because it scales across the company.

Preston's point: when you're a founder with full context, you can intuitively feel when the numbers are lying.

When you have a growing team and people are making decisions based on the metrics you give them, they do exactly what the metrics tell them to do. If you give them revenue, they'll optimize for revenue.

They'll discount harder, they'll chase looser audiences, spend against lower-intent traffic, etc.

And why wouldn’t they? They’re making the best decisions possible given the information you gave them.

As Preston put it, "It's not their fault, it's your fault as a leader."

What to measure instead

The fix Preston arrived at is contribution margin — which he said was "the slowest to learn" among the co-founders.

Put simply, contribution margin is just revenue less variable costs.

It’s the actual dollars the business retains after you subtract product cost, shipping, returns, payment processing, and marketing spend.

This isn’t a new idea, and every CFO’s been pushing for it for years.

But Preston zoomed out to make a really important point:

"When we grew that number — contribution dollars, variable profit — we had a much higher probability of improving the fundamental value of the business."

Two things are doing a lot of work in that sentence:

One is "contribution dollars" — not contribution margin as a percentage. You can game the percentage by gutting variable costs: fire the agency, kill the software tools, slash the marketing budget, and your margin % goes up while your business is dying. With that in mind, the goal is the absolute dollar number, grown over time.

The second is "fundamental value of the business.” In other words, what allows you to fund growth (and sleep at night) is the money you actually deposit in the bank.

Revenue is a step removed from that. Contribution dollars isn't.

His recommendation to marketers who want to actually internalize this was refreshingly low-tech:

"Spend more time with your finance and accounting team. As marketers, we tend to throw our hands up and be like, 'I'm creative, dude. It's my job to come up with funny taglines.' But if you freed up 20% of your time, the best way to use an incremental minute to get the most value is probably to just start hanging out with your finance team and start looking at your financial statements."

This is unglamorous advice. But it’s also the single highest-leverage move most apparel marketing leaders could make in the next quarter.

The discounting trap, seen from the margin seat

Once you shift your measure of success from revenue to contribution dollars, the entire discount conversation changes.

Preston was clear that he's not a discounting absolutist. Chubbies discounts. Most brands should, in some moderated way. His argument is about direction and trajectory.

The pattern he's seen ruin brand after brand is the one where you're doing more discounting year over year:  more events, deeper cuts, or, very common, rationalizing it as "hyper-exclusive" (app-only, two-time-purchaser-only, members-only, etc etc).

The rationalizations make it sound better but the impact is the same: you're buying revenue at a cost you're not properly measuring, and the habit is directionally negative.

His prescription is blunt:

"Just try to get to not adding more discounts. If you're trending toward adding more frequency or just more intensity — last year we did 10%, now we're doing 15% off — it never ends well. I can't think of one example of a brand for whom that ends well. So do I want to be cautionary tale number 1,000,075? No. So step one, just do the same amount of discounting you did last year. Step two, find a way to pull back on one event or on the amount. Go back to 10% from 15% and take the pain."

The reason most brands can't follow this advice isn't that they don't agree with it. It's that they've built a cost structure that requires short-term cash.

Their fixed costs are too high, their marketing mix is skewed toward channels that demand immediate payback, and the only way to hit the number this quarter is to run another promo.

This is where the contribution-dollar view becomes clarifying: if the math is showing you that another round of discounting is actually contribution-dollar-negative once you account for the paid spend driving traffic to it, the short-term fix isn't even a short-term fix. You're losing real dollars to hit a fake top-line number.

Paying too much attention to competitors

Every founder he watched fail, himself almost included, got there by watching what other brands in their cohort were doing and trying to keep up.

"The brands that were started right around when Chubbies started, many of them I was super jealous of. They were getting all the press. They would share revenue numbers in some of their press.

It would be like, wow, how did you grow so much faster than us? What's wrong with me? We should figure out how to grow faster.

Not knowing anything about their P&L, not knowing anything about how much cash they were actually dropping to the bottom line. Just not thinking that one data point was a measure of success."

This is the single most useful thing in our entire conversation for a brand leader to internalize, and it's almost impossible to do in practice.

The revenue number another brand announces in the press tells you nothing about whether their business is healthy.

As an obvious example, how many of  the high-growth DTC brands that made their cohort jealous in 2019-2021 were generating those revenue numbers at negative contribution margins and no longer exist?

Preston's next line should be printed on the wall of every apparel marketing department:

"Who cares what other brands are doing? It's my P&L, it's my cash, it's my customer, and it's my legacy that I'm building."

Pricing power is the real asset

The natural question once you buy this argument is: okay, what is the measure? If not revenue, if not revenue growth rate, if not the number I'm comparing to competitors — then what?

Preston's answer is pricing power. The ability to hold or raise prices without losing the customer. He framed it as the quiet test that separates brands with real equity from brands that are just running efficient acquisition.

"The ability to either hold constant or start to dial back total marketing spend and therefore start to generate more profit dollars. A lot of what I realized — again, humility, was wrong — is that that's the asset. It's not like getting some revenue number based off of this constant search for short-term arbitrage. I found some targeting hack that allows me to increase my efficiency some amount. Not that those things are bad, but the diminishing returns of spending an incremental minute thinking about that stuff versus allocating that thought time to being able to build the asset that can dominate regular-price sell-through at velocities exceeding forecast — those are the things I should have been spending more time on."

If you can raise prices without losing customers, you have a brand. If you can hold prices while competitors discount, you have a brand. If every promotion you run just pulls future revenue forward without adding new customers who will stick, you don't — you have an efficient funnel, which is a different and more fragile thing.

This reframes what "brand building" actually is in P&L terms. It isn't a line item for the fund-it-if-we-hit-the-number slush budget. It's the work that, over time, earns you the right to charge more and spend less on marketing. Which is to say: it's the work that grows contribution dollars on a multi-year basis instead of pulling them forward into this quarter.

What this means for the next year of your business

A few things worth taking from all of this:

Get contribution dollars into your operating rhythm.

Not monthly, after the books close. Weekly, at a level that the marketing team can see and act on. If your marketing dashboard only reports revenue and ROAS, it's structurally incentivizing the wrong behavior. The contribution-dollar number doesn't have to be perfect — a reasonable weekly approximation is 100x better than waiting for the month-end read.

Pressure-test your blended margin assumptions at the SKU and collection level.

The blended assumption is almost always wrong, and the places where it's wrong are where your business is leaking money. A category-level audit can surface this in a week.

Hold the line on discounting year over year.

Not zero discounting — just not more discounting than last year. If you're trending toward more frequency or deeper cuts, you're on the path Preston is describing, and the exit ramp is painful but gets worse the longer you wait.

Stop benchmarking yourself against competitor revenue claims.

Either you have access to their P&L, in which case benchmark against that, or you don't, in which case their revenue announcements tell you nothing about whether their business is healthy or about whether yours is.

Start watching pricing power as a leading indicator.

Can you hold price through a promotional period that competitors are discounting into? Can you raise price on a SKU and hold sell-through? These are signals that the brand is doing its real job. Their absence is an early warning.

Preston's framing essentially inverts the way most apparel marketing conversations get structured.

The question isn't "how do we grow revenue faster?" It's "are we building something that has the right to grow at improving margin over time?"

One of those questions has a lot of short-term answers that feel productive and hurt the business; the other has a smaller set of answers that are harder to execute and actually compound.

"That's where equity value comes from," Preston said. "That's where life-changing financial outcomes come from. It's not from having some DR arbitrage that lasts for five days and then you have to go and find the next one."

He built a brand through the full cycle and sold it. He's earned the right to that sentence.

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