ROAS (return on ad spend)

ROAS is the revenue attributed to ads divided by the ad spend that produced it. The attribution rule, window and platform change the result.

Stock photos and example labels, not customers.

Definition

ROAS is the revenue attributed to ads divided by the ad spend that produced it. The attribution rule, window and platform change the result.

FormulaROAS = attributed revenue / ad spend

Example with made-up numbers: An ad set spends 1,000 and the platform attributes 3,200 in revenue. ROAS = 3,200 / 1,000 = 3.2.

How to use it

ROAS is easy to calculate and easy to misread. The revenue on top comes from a platform's own attribution, so two platforms can claim the same order and the total can be larger than the store's revenue.

Use it to compare ads and ad sets inside one platform. For a question about the whole business, use MER, and for a question about profit, compare ROAS with break-even ROAS.