Divide ad-attributed revenue by ad spend to get ROAS and ROAS percent.
Overview
ROAS (return on ad spend) measures how much revenue you generate for each dollar of advertising.
Enter ad spend and attributed revenue. A ROAS of 3.0 means $3 revenue per $1 spent.
ROAS is not profit: high ROAS with thin margins can still lose money after COGS and fees.
Steps
Media cost for the campaign or period.
Revenue attributed to those ads.
Review ROAS ratio and percent.
Run paid search, social, and display separately.
Pair ROAS with profit margin before scaling.
Math
ROAS = revenue / adSpend; ROAS% = ROAS × 100
Divide attributed revenue by ad spend. Multiply by 100 for a percentage view.
Worked cases
15,000/5,000 = 3.0 (300%)
ROAS 3.0.
10,000/2,000 = 5.0
ROAS 5.0.
6,400/8,000 = 0.8
ROAS 0.8 (below 1.0).
Why use this
Questions