ROAS calculator.

ROAS = revenue from ads ÷ ad spend. If £5,000 of spend drives £20,000 of revenue, your ROAS is 4.0x: £4 back for every £1 spent, sometimes written as 400%.

Break-even ROAS = 1 ÷ gross margin. It’s the ROAS at which ad spend exactly cancels out the gross profit on your sales. At a 50% margin you break even at 2.0x; at 25% you need 4.0x just to stand still. That’s why the same ROAS can be excellent for one business and loss-making for another.

ROAS vs ROI

ROAS measures revenue per pound of ad spend. ROI (or profit) also accounts for product costs, fulfilment, fees and overheads. A campaign can show a healthy platform ROAS and still lose money once those costs are included, so set targets from your margins, not generic benchmarks.

Reported ROAS vs incremental ROAS

Platform-reported ROAS includes some sales that would have happened anyway: from loyal customers or people already searching for you. Incremental ROAS counts only the revenue your ads genuinely add, so it’s usually lower but closer to the truth. Holdout tests and settings such as Meta’s incremental attribution help you estimate it.

How to improve ROAS

• Fix tracking first: pass accurate purchase values so bidding optimises to revenue, not order count.
• Cut wasted spend: irrelevant search terms, poor placements and audiences that never convert.
• Improve feeds and landing pages: better product titles, images and page speed lift conversion rate at the same spend.
• Bid to profit, not volume: use value-based bidding with a target set above break-even.

For more depth, read what is a good ROAS? or see how our PPC management is run for profit.