Metrics
What is ROAS?
Return on Ad Spend
Return on Ad Spend - measures revenue generated per dollar of ad spend.
The Formula
ROAS = Ad Revenue ÷ Ad Spend
ROAS (Return on Ad Spend) measures how much revenue you earn for every dollar spent on advertising. It's the inverse of ACoS.
How ROAS Works
ROAS is expressed as a multiple (e.g., 4x, 5x). A ROAS of 4x means you earn $4 for every $1 spent on ads.
The Formula
ROAS = Ad Revenue ÷ Ad Spend
Example
If your ads generate $5,000 from $1,000 in spend:
- ROAS = $5,000 ÷ $1,000 = 5x
- You earn $5 for every $1 in ad spend
ROAS vs ACoS Conversion
| ROAS | ACoS |
|---|---|
| 10x | 10% |
| 5x | 20% |
| 4x | 25% |
| 3x | 33% |
| 2x | 50% |
| 1x | 100% |
Formula: ACoS = (1 ÷ ROAS) × 100
What's a Good ROAS?
| ROAS | Rating |
|---|---|
| 5x+ | Excellent |
| 3-5x | Good |
| 2-3x | Average |
| 1-2x | Low |
| <1x | Losing Money |
Finding Your Break-Even ROAS
Your break-even ROAS depends on your profit margin:
Break-Even ROAS = 1 ÷ Profit Margin
Example: If your profit margin is 25%, your break-even ROAS is 4x. Any ROAS above 4x generates profit.
Examples
- →$10,000 revenue ÷ $2,000 spend = 5x ROAS
- →$3,000 revenue ÷ $1,000 spend = 3x ROAS
- →$8,000 revenue ÷ $2,000 spend = 4x ROAS
Related Terms
Free Calculator
ROAS Calculator
Calculate your ROAS instantly with our free tool
Try it now →Track your ROAS automatically
Shurq monitors all your key metrics in real-time and optimizes your campaigns 24/7.