Free marketing calculator · Advertising performance
ROAS Calculator
Calculate return on ad spend and see how much attributable revenue your advertising generates for every pound, dollar or euro invested.
ROAS is useful because it puts advertising revenue and media spend onto the same scale. But a high ROAS does not automatically mean a profitable campaign, so this calculator also helps put the number in context.
What is ROAS?
Return on ad spend (ROAS) measures attributable advertising revenue relative to advertising spend. A ROAS of 4.00x means £4 of attributable revenue was generated for every £1 of ad spend.
Example: £20,000 of attributable revenue ÷ £5,000 of ad spend = 4.00x ROAS.
ROAS is not the same as profit
ROAS measures revenue efficiency, not profit. Revenue still has to cover the variable costs associated with the sale and, depending on the question you are asking, other costs such as fulfilment, fees, overheads and marketing costs beyond the advertising spend entered here.
This is why two businesses can generate the same ROAS and have very different economics. A business with a 25% contribution margin needs a higher revenue multiple to recover its advertising spend than one with a 60% contribution margin.
What is break-even ROAS?
When contribution margin is known, break-even ROAS provides a useful commercial reference point. In a simplified model where advertising spend is the cost being recovered, break-even ROAS is the inverse of contribution margin.
At a 25% contribution margin, simplified break-even ROAS is 4.00x. At a 40% contribution margin, it is 2.50x.
That is a modelling tool rather than a universal target. Your real break-even point depends on which costs are included in the contribution margin and which costs the campaign needs to cover.
How to use ROAS well
Use the same attribution basis when comparing campaigns or periods. If one report uses seven-day click attribution and another uses a different window or includes view-through conversions, the ROAS figures are not directly comparable.
ROAS also becomes more useful when considered alongside conversion rate, customer acquisition cost and customer lifetime value. A campaign can look weaker on immediate ROAS while acquiring customers who become more valuable over time; the reverse can also be true.
Want the wider campaign picture?
The ROAS calculator is designed for a quick answer. The Campaign Performance Calculator connects ROAS with CTR, CPC, CPM, CPL, CPA, conversion rates, contribution and break-even analysis.
ROAS calculator FAQs
What does 5x ROAS mean?
A 5.00x ROAS means the campaign generated £5 of attributable revenue for every £1 of advertising spend, or the equivalent in your chosen currency.
Is a higher ROAS always better?
Not necessarily. ROAS needs context from margin, volume, customer value, incrementality and your commercial objectives. Maximising ROAS alone can sometimes favour smaller, easier-to-convert audiences rather than the level of spend that produces the best overall contribution.
What is the difference between ROAS and ROI?
ROAS compares attributable advertising revenue with ad spend. ROI is a broader profitability concept that compares a return or gain with the investment required to produce it. The exact ROI definition should always state which costs and returns are included.
Should I use revenue from all sales?
For campaign ROAS, use revenue attributed to the advertising activity being measured rather than total business revenue. If you want to compare total revenue with total marketing spend, MER is the more appropriate metric.