Glossary
What is ROAS?
return on ad spend
ROAS (return on ad spend) is revenue you earn per unit spent on ads. Divide revenue attributed to ads by ad spend.
Example
You spent 1,000 and customers from those ads paid 4,000: ROAS is 4.
Why it matters, and where it stops
ROAS ignores your margin: a ROAS of 2 can still lose money on low-margin offers. Compare it to profit margin. To calculate it you need to know which campaign brought each customer, which means tracking source: for example with UTM parameters.