What your ROAS does and doesn’t tell you
ROAS is the number everyone looks at. It is useful, but it only tells part of the story.
The AdSweet teamFor online shopsWhat ROAS does tell you
Which ad brings in more revenue for every euro. To compare two ads, it is a good number.
What ROAS doesn’t tell you
- Whether you make a profit. That depends on your margin.
- Whether they are new customers, or people who were going to buy anyway.
- What a customer will still buy later.
- Which sales Meta couldn’t measure.
Look at three numbers together
- 1Your ROAS next to your break-even ROAS: do you earn on a sale?
- 2What a new customer costs.
- 3Your total revenue divided by your total ad cost: do your ads pay off together?
Frequently asked questions
What is a good ROAS?
That depends on your margin. With a 50% margin everything above 2 is profit, with a 25% margin only above 4. A ROAS without your margin therefore says little.