ROAS calculator
Calculate return on ad spend as a revenue multiple while keeping revenue separate from profit.
Last updated
Written by Madly editorial
01 / Your inputs
Run the numbers
Example figures are filled in so you can see a result straight away. Replace them with your own. Results update as you type; no data is sent or saved.
Revenue attributed to the ads, in the same currency as spend.
Total media spend; must be greater than zero.
02 / Calculation
Return on ad spend
Calculated result
3×
Unit: ×
Formula
ROAS (×) = attributed revenue (£) ÷ ad spend (£).
How to read this
For every £1 in ad spend, your inputs attribute £3 in revenue. Revenue exceeds ad spend, but that does not establish profit. ROAS excludes product costs, fees, returns and overheads.
Compare with your cost-based break-even ROASAssumptions
Revenue and spend must use the same currency, reporting window and attribution convention. Revenue is not contribution margin.
How to use this tool
- Take the revenue attributed to your ads and the ad spend for the same period.
- Enter both and read the revenue per unit of spend.
- Compare it with your break-even ROAS to see whether the ads cover their costs.
- Check the attribution window, because a longer window makes ROAS look higher.
Worked example
Illustrative example: £1,200 in attributed sales from £400 ad spend gives 3× ROAS.
What this measures
Return on ad spend (ROAS) compares attributed sales revenue with ad spend, before product and fulfilment costs.
Formula and units
ROAS (×) = attributed revenue (£) ÷ ad spend (£).
Assumptions and review notes
Revenue and spend must use the same currency, reporting window and attribution convention. Revenue is not contribution margin.
3× does not mean a 3× profit. Compare it with your own break-even ROAS based on your costs.
ROAS is revenue, not profit. Whether 3.0 is good depends on your margin, so a 60% margin store and a 25% margin store need very different numbers. The right comparison is your break-even ROAS. Anything above it earns something toward overheads and profit, and anything below it loses money on each order.
- Gross margin and product cost.
- Shipping, fees and returns.
- Attribution window and view-through credit.
- Repeat purchases that platform reports may not count.
- Equating high ROAS with profit.
- Comparing ROAS from different attribution windows.
- Ignoring that platform ROAS and your store revenue may differ.
- Scaling on ROAS from a very small number of orders.
A closer look
Common questions.
- What does ROAS stand for?
- Return on ad spend. It is attributed revenue divided by ad spend.
- Is 4x ROAS good?
- It depends on margin. At a 20% margin 4x is below break-even, while at 50% it is comfortably above it.
- Why is platform ROAS higher than my store data?
- Platforms may count conversions you would credit elsewhere and may use longer windows. Compare against your own revenue as well.
- ROAS or MER?
- ROAS is channel level and attributed. MER divides total revenue by total marketing spend and avoids attribution arguments.
- What should I do with a low ROAS?
- Check conversion rate, order value and the offer first, then creative. Do not cut spend or scale without knowing your break-even.