Definition
The revenue generated for every dollar spent on advertising.
Formula
Revenue attributed to ads / Ad spend
How to measure
Attribute revenue from customers who converted through a specific ad channel and divide it by that channel's total spend.
Why track it
ROAS is the bottom-line judgment call for whether to keep scaling, hold, or cut a paid channel.
Example
A campaign spending $5,000 and generating $20,000 in attributed revenue reports a 4x ROAS.
FAQ
- What is Return on Ad Spend?
- The revenue generated for every dollar spent on advertising.
- How do you calculate Return on Ad Spend?
- Revenue attributed to ads / Ad spend
- Why track Return on Ad Spend?
- ROAS is the bottom-line judgment call for whether to keep scaling, hold, or cut a paid channel.