Performance Marketing
What is Return on Ad Spend (ROAS)?
Return on Ad Spend (ROAS) measures the revenue generated for every dollar spent on advertising, calculated as revenue attributed to ads divided by ad spend, used to judge paid campaign efficiency.
Who Is It For?
ROAS is tracked by paid media teams and reviewed by leadership when evaluating whether ad spend is paying off.
How Is It Used?
It’s used to judge whether ad spend is generating enough revenue to justify continued or increased investment in a given channel or campaign.
- Calculate ROAS as attributed revenue divided by total ad spend
- Segment ROAS by channel and campaign, since it can vary widely
- Set a minimum ROAS threshold based on margins and business goals
- Pair ROAS with CAC and lead quality, since revenue attribution isn’t always perfectly clean
Related Terms & Concepts
Frequently Asked Questions
What’s a good ROAS for B2B SaaS?
It varies by margin structure and deal size, so there’s no universal benchmark — the more useful comparison is a campaign’s ROAS against its own historical performance and against other channels.
Is ROAS the same as ROI?
They’re related but not identical — ROAS focuses specifically on ad spend versus attributed revenue, while ROI accounts for total costs (including non-ad expenses) against total return.
