Calculate your Return on Ad Spend to measure campaign profitability and optimize your advertising investment for maximum ROI.
Total revenue from ad campaigns
Total amount spent on advertising
Revenue return per dollar spent
Formula: ROAS = Revenue Generated ÷ Ad Spend
ROAS (Return on Ad Spend) measures how much revenue you generate for every dollar spent on advertising. It's crucial for determining campaign profitability.
Determine which campaigns generate the highest return on investment.
Allocate more budget to high-ROAS campaigns and optimize or pause low-performing ones.
Set ROAS targets and compare performance across different channels and time periods.
Get answers to common questions about ROAS calculations and optimization
A good ROAS depends on your industry and profit margins. Generally, 4:1 (400%) is considered good, meaning $4 revenue for every $1 spent. E-commerce often targets 3-5:1.
ROAS focuses specifically on advertising spend and revenue, while ROI considers all costs including product costs, overhead, and other expenses beyond just ad spend.
Optimize targeting, improve ad creative, focus on high-converting keywords, reduce wasted spend, increase conversion rates, and test different bidding strategies.
Use ROAS for quick advertising performance assessment and ROI for comprehensive profitability analysis including all business costs.
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Start calculating your return on ad spend today and optimize your campaigns for maximum profitability.