ROAS (return on ad spend)
Also known as: Return on ad spend
In short
Attributed conversion value divided by advertising spend, commonly expressed as a ratio or percentage for a defined reporting scope.
Compare attributed value with ad cost
ROAS measures value relative to advertising spend. Calculate it as attributed conversion value ÷ ad spend. Multiply the ratio by 100 to express it as a percentage.
The numerator requires a clear definition. In a sales report it may represent purchase revenue, while another setup may use assigned lead values. State what the values include, their currency and how attribution assigns them to advertising.
Use matching scope and dates, and account for reporting delays. Combining separately attributed platform totals can count the same order more than once.
Illustrative calculation
Imagine a fictional campaign with $2,400 in attributed purchase revenue and $800 in ad spend for a defined period. Its ROAS is 2,400 ÷ 800 = 3, often written as 3x or 300%.
That means three units of attributed revenue per unit of ad spend. It does not mean three units of profit. Product costs, fulfillment and other expenses have not been subtracted in that calculation.
Keep attribution and profitability separate
ROAS is sensitive to conversion values, attribution settings and returns handling. It also does not establish how much revenue the campaign caused beyond what would have happened anyway. Evaluate commercial margins separately and use incrementality testing when the decision depends on additional demand rather than attributed value.