ROAS Calculator
Calculate Return on Advertising Spend to measure marketing campaign effectiveness
Calculate ROAS
Total amount spent on advertising campaign
Revenue generated directly from this advertising campaign
Example Calculation
E-commerce Facebook Campaign
Campaign: Summer Product Launch
Ad Spend: $1,000
Revenue Generated: $4,000
Campaign Duration: 30 days
Platform: Facebook Ads
Calculation
ROAS = (Revenue ÷ Ad Spend) × 100
ROAS = ($4,000 ÷ $1,000) × 100
ROAS = 400%
Profit = $4,000 - $1,000 = $3,000
Analysis
A 400% ROAS means you earned $4 for every $1 spent on advertising. This is considered good performance for Facebook Ads, indicating a profitable campaign that covers additional business costs while generating substantial profit.
ROAS Benchmarks
< 100%
Loss - Review strategy immediately
100% - 200%
Break-even to low profit
200% - 400%
Moderate performance
400% - 800%
Good performance
800%+
Excellent performance
ROAS vs ROI
ROAS
Revenue ÷ Ad Spend × 100
ROI
Profit ÷ Investment × 100
ROAS measures revenue efficiency, ROI measures profit efficiency
High ROAS doesn't guarantee profitability
Understanding ROAS (Return on Advertising Spend)
What is ROAS?
Return on Advertising Spend (ROAS) is a marketing metric that measures the amount of revenue generated for every dollar spent on advertising. It helps businesses evaluate the effectiveness of their advertising campaigns and optimize their marketing budget allocation.
Why is ROAS Important?
- •Measures advertising campaign effectiveness
- •Guides budget allocation decisions
- •Identifies high-performing campaigns
- •Enables campaign optimization
ROAS Formula
ROAS = (Revenue from Advertising ÷ Cost of Advertising) × 100
- Revenue from Advertising: Direct revenue attributed to the campaign
- Cost of Advertising: Total amount spent on the campaign
- Result: Percentage return on advertising investment
Key Insight: A ROAS of 400% means you earn $4 in revenue for every $1 spent on advertising, resulting in $3 profit before other costs.
Platform-Specific ROAS Benchmarks
Google Ads
- • Minimum: 200%
- • Good: 400%
- • Excellent: 800%+
Facebook/Instagram
- • Minimum: 250%
- • Good: 400%
- • Excellent: 600%+
LinkedIn Ads
- • Minimum: 300%
- • Good: 500%
- • Excellent: 800%+
Amazon Ads
- • Minimum: 300%
- • Good: 500%
- • Excellent: 1000%+
Factors Affecting ROAS
Campaign Factors
- • Target audience quality
- • Ad creative effectiveness
- • Bidding strategy
- • Campaign timing
- • Budget allocation
Business Factors
- • Product/service quality
- • Pricing strategy
- • Brand recognition
- • Customer reviews
- • Market competition
Technical Factors
- • Website conversion rate
- • Landing page quality
- • Tracking accuracy
- • Attribution model
- • Platform algorithms
ROAS Optimization Strategies
Increase Revenue
- • Improve ad targeting
- • Optimize ad creatives
- • Enhance landing pages
- • Increase conversion rates
- • Implement upselling
Reduce Costs
- • Optimize bidding strategies
- • Improve quality scores
- • Refine audience targeting
- • A/B test ad variations
- • Remove underperforming keywords