Free tool
Calculate return on ad spend from attributed revenue and ad cost.
ROAS = Ad revenue ÷ Ad spend. Break-even ROAS ≈ 1 ÷ Gross margin.
Ads spent 80,000 and attributed 320,000 revenue. ROAS = 4.0, or 400%.
ROAS is a media ratio. It does not know your COGS, shipping or return rate. A 4x ROAS on a 25% gross margin product is around break-even before overhead. A 4x ROAS on a 70% margin digital add-on is highly profitable.
If gross margin is 40%, you need about 2.5x ROAS to cover product cost (1 ÷ 0.40). Payment fees and variable shipping push that number up. Use the margin field in this calculator to see a simple break-even ROAS.
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ROAS = Ad revenue ÷ Ad spend.
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