Marketing & Ads

ROAS Calculator

Calculate Return on Ad Spend — revenue per dollar of advertising.

ROAS (Return on Ad Spend) is the primary metric for evaluating paid advertising efficiency. A 4x ROAS means you earn $4 in revenue for every $1 spent on ads. Knowing your break-even ROAS determines whether campaigns are profitable.

Enter your numbers

Ad-Attributed Revenue ($)

Total Ad Spend ($)

Cost of Goods Sold (%)40%

Percentage of revenue that is product cost.

Results update as you change the inputs. Calculations run in your browser.

ROAS

4.00x

gross Profit: $4200
break Even R O A S: 1.67x break-even
profitable: Profitable Campaign

See the formula

Formula and method

ROAS = Revenue / Ad Spend; Break-Even ROAS = 1 / (1 - COGS%)

ROAS is a revenue metric, not a profit metric. Break-even ROAS accounts for cost of goods and is the minimum ROAS needed for profitability.

Worked examples

Facebook e-commerce campaign

Ad-Attributed Revenue ($):: 20000
Total Ad Spend ($):: 5000
Cost of Goods Sold (%):: 45

ROAS: 4.00x

Google Shopping campaign

Ad-Attributed Revenue ($):: 8000
Total Ad Spend ($):: 3000
Cost of Goods Sold (%):: 60

ROAS: 2.67x

Assumptions and limits

Revenue fully attributed to ads
No overhead or labor costs in break-even calculation

This tool provides an educational estimate. Rules, rates and personal circumstances can change the answer. Review the assumptions before relying on a result. Report a correction.

Common mistakes to avoid

Confusing ROAS with ROI — ROAS ignores COGS and overhead, ROI accounts for all costs.
Measuring ROAS at the campaign level without accounting for blended organic attribution.
Setting the same ROAS target for all campaigns regardless of product margin.

Frequently asked questions

What is a good ROAS?

It depends on your margins. A product with 70% gross margin needs only 1.43x ROAS to break even. A product with 30% margin needs 3.33x. Always calculate your break-even ROAS before setting targets.

What is MER (Marketing Efficiency Ratio)?

MER is total revenue / total marketing spend — a top-down metric that includes all channels. It is gaining favor over channel-specific ROAS because it avoids attribution model disputes.