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Spending on advertising (€)

Revenue attributed to advertising (€)

ROAS

ROAS formula: Revenue attributed to ads / Ad spend. Only considers investment in ads.

FAQs

What is ROAS and how is it calculated?

Return on Ad Spend (ROAS) measures the revenue generated for every euro invested in advertising. It is calculated by dividing the revenue obtained by the advertising expenditure. For example, if you invest €500 and generate €2,000 in sales, your ROAS is 4, meaning that for every euro invested you get €4 in return.
What is considered a good ROAS?

A ROAS of 4:1 (400%) is considered the general benchmark, although it depends on each business's profit margin. If your margin is low, you'll need a higher ROAS to be profitable. In e-commerce, it's common to aim for a minimum ROAS of 3 before scaling up your budget.
What is the difference between ROAS and ROI?

ROAS measures only the return on advertising spend, without considering other business costs. ROI (return on investment) is broader and includes all costs associated with the product or service. ROAS is useful for optimizing campaigns; ROI, for evaluating the overall profitability of the business.

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