What Is Return on Ad Spend (ROAS)?
Return on ad spend (ROAS) is the revenue generated for every unit of currency spent on advertising, calculated as revenue from ads divided by ad spend. It's the core efficiency metric for paid media — a ROAS of 4 means €4 of revenue per €1 spent.
Key takeaways
- ROAS = revenue from ads ÷ ad spend.
- It measures paid-media efficiency at the campaign or channel level.
- Unlike ROI, ROAS uses revenue, not profit — so factor in margins.
How to calculate it
ROAS = Revenue from Ads ÷ Ad Spend
Often expressed as a ratio (4:1) or multiple (4×).
ROAS vs ROI
ROAS measures revenue per ad dollar; ROI measures profit per dollar after all costs. A high ROAS can still be unprofitable if margins are thin, so use ROAS to optimize campaigns and ROI to judge whether the activity actually makes money.
Frequently asked questions
What is ROAS?
Return on ad spend — the revenue generated per unit of advertising spend, calculated as ad revenue divided by ad cost.
How do you calculate ROAS?
Divide the revenue attributed to ads by the amount spent on those ads. A result of 4 means €4 revenue per €1 spent.
What's the difference between ROAS and ROI?
ROAS uses revenue; ROI uses profit after costs. A strong ROAS can still be unprofitable if margins are low, so they serve different purposes.
Related service: Track ad performance in HubSpot