📈 ROAS Calculator
Calculate Your Return on Ad Spend & Measure Advertising Profitability
Know if your ads are actually profitable
ROAS Calculator
📋 Detailed Breakdown
What is ROAS (Return on Ad Spend)?
ROAS measures the revenue generated for every dollar spent on advertising. A ROAS of 4x means you earn $4 for every $1 spent on ads. It's the most important metric for measuring advertising profitability.
✅ ROAS vs ROI
- ROAS: Revenue ÷ Ad Spend (4x = $4 revenue per $1 spent)
- ROI: (Revenue - Cost) ÷ Cost × 100% (300% = 3x profit on investment)
- ROAS = ROI + 1 (A 4x ROAS = 300% ROI)
⚠️ What ROAS Doesn't Include
ROAS measures gross revenue vs ad spend only. It doesn't account for: product costs (COGS), shipping, payment processing fees, overhead, or other marketing costs. True profitability requires considering all costs.
ROAS Formulas
Basic ROAS Formula
ROAS to ROI Conversion
Break-Even ROAS
Required Ad Spend for Target Revenue
| ROAS | ROI | Meaning | Status |
|---|---|---|---|
| 0.5x | -50% | Losing $0.50 per dollar | ❌ Losing |
| 1.0x | 0% | Breaking even | ⚠️ Break-even |
| 2.0x | 100% | $2 revenue per $1 spent | ✅ Profitable |
| 4.0x | 300% | $4 revenue per $1 spent | 🚀 Excellent |
| 8.0x+ | 700%+ | $8+ revenue per $1 spent | ⭐ Outstanding |
Industry ROAS Benchmarks (2026)
| Industry | Avg ROAS | Good ROAS | Notes |
|---|---|---|---|
| E-commerce (General) | 2.5-4x | 4x+ | Varies by margin |
| Fashion/Apparel | 3-5x | 5x+ | High repeat customers |
| Electronics | 2-3x | 4x+ | Higher margins |
| Health & Beauty | 3-6x | 6x+ | Strong LTV |
| SaaS/Software | 3-8x | 5x+ | Recurring revenue |
| Local Services | 2-4x | 4x+ | High margin services |
| Lead Generation | 5-10x | 8x+ | High-ticket sales |
💡 What's a "Good" ROAS?
It depends on your profit margins. If you have 50% gross margin, you need at least 2x ROAS to break even (before overhead). With 25% margin, you need 4x ROAS. Calculate your break-even ROAS first, then aim for at least 1.5-2x above that.
ROAS by Advertising Platform
| Platform | Avg ROAS | Best For |
|---|---|---|
| Google Search Ads | 4-8x | High-intent buyers |
| Google Shopping | 5-10x | E-commerce products |
| Facebook/Meta Ads | 2-5x | Awareness + retargeting |
| Instagram Ads | 2-4x | Visual products |
| TikTok Ads | 2-4x | Young audience, viral |
| YouTube Ads | 2-4x | Brand awareness |
| Amazon Ads | 3-7x | Product sales |
How to Use This Calculator
- Enter your ad spend — Total amount spent on the campaign.
- Enter your revenue — Total revenue attributed to those ads.
- View your ROAS — See the multiplier and profitability status.
- Check metrics — Review ROI%, profit margin, and profit amount.
- Compare to benchmarks — See how you stack up against your industry.
Tips for Improving ROAS
🎯 Better Targeting
- Use Lookalike Audiences
- Exclude irrelevant audiences
- Focus on high-intent keywords
- Retarget website visitors
📈 Improve Conversions
- Optimize landing pages
- A/B test ad creatives
- Improve page load speed
- Simplify checkout process
💰 Increase Order Value
- Upsells and cross-sells
- Bundle deals
- Free shipping thresholds
- Loyalty programs
Official Resources
Frequently Asked Questions
It depends on your margins. A common benchmark is 4x ROAS for e-commerce. However, if your profit margin is 25%, you need 4x just to break even (before overhead). Calculate your break-even ROAS first, then aim for 1.5-2x above that.
ROAS = Revenue ÷ Ad Spend (expressed as a multiplier like 4x). ROI = (Revenue - Cost) ÷ Cost × 100% (expressed as a percentage like 300%). A 4x ROAS equals 300% ROI. ROI accounts for the cost itself, ROAS doesn't.
Maybe. 2x ROAS means you're making $2 for every $1 spent, but this doesn't account for product costs, shipping, or overhead. If your gross margin is 50%, 2x ROAS means you're breaking even. Factor in all costs to determine true profitability.
Break-even ROAS = 1 ÷ Gross Margin. If your gross margin is 40%, break-even ROAS = 1 ÷ 0.40 = 2.5x. You need at least 2.5x ROAS to cover product costs, and more to cover overhead and profit.
Common causes: poor targeting (reaching wrong audience), weak ad creative, slow or confusing landing page, pricing issues, tracking problems, or highly competitive market. Audit each step of your funnel to identify bottlenecks.
Use ROAS if order values vary (e-commerce). Use CPA (Cost Per Acquisition) if orders have similar values (subscriptions, leads). ROAS is better for maximizing revenue, CPA for consistent cost control.
Most businesses aim for 3-4x ROAS minimum to be profitable after all costs. Calculate your specific break-even point, add 50-100% for overhead and profit, and that's your minimum target.
No. Standard ROAS only measures first-purchase revenue. For businesses with repeat customers, LTV-based ROAS (Lifetime Value) is more accurate. A 2x first-purchase ROAS might be excellent if customers have 5x LTV.
Check weekly for ongoing campaigns. Don't make decisions on daily fluctuations. Allow 7-14 days of data before optimizing. For seasonal businesses, compare to the same period last year.
100% free! No sign-up required. Calculate your ROAS as often as needed to track campaign performance.
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Last Updated: January 2026