Marketing
ROAS Calculator
Return on ad spend (ROAS) measures how much revenue an advertising campaign generated for every dollar spent. It's one of the most common metrics for evaluating paid marketing performance.
The formula
ROAS = ad revenue ÷ ad spend
profit = ad revenue − ad spend
Worked example
A campaign generates $5,000 in revenue from $1,000 in ad spend:
ROAS = 5,000 ÷ 1,000 = 5x
profit = 5,000 − 1,000 = $4,000
Frequently asked questions
What is a good ROAS?
It depends on your margins and industry — a common benchmark is 4x (meaning $4 in revenue for every $1 spent), but businesses with thin margins may need a higher ROAS to be profitable, while high-margin businesses can be profitable at a lower ROAS.
How is ROAS different from ROI?
ROAS compares revenue to ad spend as a multiple (e.g. 5x), while ROI compares profit to cost as a percentage. ROAS doesn't subtract costs like product cost or overhead, so a campaign can have a high ROAS but still be unprofitable once all costs are considered.
Does ROAS account for the cost of goods sold?
No — this calculator only compares ad revenue to ad spend. To see true profitability, you'd need to subtract the cost of goods sold and other expenses from revenue before comparing it to ad spend.