Return on Ad Spend (ROAS) is the revenue generated for each dollar of media spend. A 3× ROAS means $3 in tracked revenue for each $1 of media spend. Keep media spend and agency or platform fees separate when assessing the full cost of acquisition.
How to calculate ROAS
ROAS = Revenue from ads ÷ Ad spend
If you spent $10,000 on Meta ads and generated $35,000 in tracked sales, your ROAS is 3.5×.
What is a useful ROAS target?
There is no universal benchmark. Set a target using your margins, customer value, sales process, and the quality and amount of data available. The right target can also differ by product, campaign, channel, and stage of growth. Review media spend separately from fees and other operating costs rather than treating ROAS alone as profit.
Why your ROAS might be wrong
Attribution is the most common issue. If you are using last-click attribution and a customer saw your Meta ad, then Googled you and converted — that sale gets credited to Google, not Meta. Your Meta ROAS looks worse than it is.
Three ways to improve ROAS without increasing spend
1. Improve your landing page conversion rate. In a precise like-for-like example, moving from 2% to 3% CVR is a 50% relative increase; with traffic, AOV, and spend unchanged, ROAS also moves from 2× to 3× (also a 50% increase). 2. Improve average order value. Higher AOV means more revenue per click. 3. Tighten audience targeting. Removing low-intent audiences reduces wasted spend.