ROAS Calculator
Calculate Return on Ad Spend (ROAS) from total ad spend and revenue generated, expressed as both a ratio and a percentage.
$
$
ROAS
4.00:1
400%
Revenue Minus Ad Spend
$15,000
How ROAS Is Calculated
Return on Ad Spend (ROAS) measures how much revenue you generate for every dollar spent on advertising. Enter your total ad spend and the revenue it generated to see your ROAS as both a ratio and a percentage.
Example
Spending $5,000 on ads that generate $20,000 in revenue gives a ROAS of 20,000 ÷ 5,000 = 4, often written as "4:1" or 400%. That means every $1 spent on ads returned $4 in revenue.
Common Use Cases
- Evaluating the performance of a specific ad campaign or channel.
- Comparing ROAS across platforms (search, social, display) to allocate budget.
- Setting minimum ROAS targets before scaling ad spend.
- Reporting campaign performance to stakeholders or clients.
FAQs
What is a good ROAS?
A commonly cited baseline is 4:1 (400%), meaning $4 in revenue per $1 spent, but the right target depends on your profit margins. Low-margin businesses need a higher ROAS to be profitable than high-margin ones.
Is ROAS the same as ROI?
No. ROAS compares revenue to ad spend only, while ROI (return on investment) typically factors in all costs, including product cost and overhead, to measure actual profit relative to total investment.
Can ROAS be misleading?
Yes — a high ROAS doesn't guarantee profitability if your product margins are thin or if it ignores other costs like fulfillment and returns. Always check ROAS alongside your actual profit margins.