Return on Ad Spend Calculator

How to Calculate ROAS

Return on Ad Spend (ROAS) measures how much revenue your advertising generates for every dollar spent. It is the primary metric for evaluating advertising campaign efficiency.

ROAS Formula

ROAS is calculated by dividing the revenue attributed to ads by the total advertising spend:

A ROAS of 4x means every $1 spent on ads generated $4 in revenue. A ROAS of 1x means break-even — the ads generated exactly enough revenue to cover their cost.

What is a Good ROAS?

ROAS benchmarks vary significantly by advertising channel and industry. Use this table as a general guide:

ROAS vs ROI

ROAS and ROI are related but measure different things:

• ROAS measures revenue per ad dollar (top-line). It focuses specifically on advertising effectiveness.
• ROI measures profit as a percentage of total investment (bottom-line, includes all costs like production, overhead, and taxes).

A campaign with a 4x ROAS might still have a low ROI if product costs, fulfilment, and overhead eat into the revenue. Use our ROI calculator for bottom-line analysis.

ROAS for Accountants

Accountants advising clients on marketing spend can use ROAS to evaluate whether advertising budgets are being used effectively. By comparing ROAS across channels and campaigns, you can help clients allocate marketing budgets where they generate the most revenue and identify underperforming campaigns that should be optimised or paused.