A ROAS of 4x (£4 revenue per £1 spent) is a common minimum target, but the ideal figure depends on your gross margin. A business with 30% margin needs at least 3.33x ROAS to break even on ad spend.

How do I calculate break-even ROAS?

Break-even ROAS = 1 ÷ Gross Margin. For example, with a 25% gross margin: break-even ROAS = 1 ÷ 0.25 = 4x. Any ROAS above this generates a gross profit contribution.

What is the difference between ROAS and ROI?

ROAS only compares revenue to ad spend. ROI is a broader measure that accounts for all costs (production, fulfilment, overheads) against profit, not just revenue versus ad spend.

ROAS Calculator

Calculate your Return on Ad Spend (ROAS) — the revenue generated for every pound spent on advertising. Also find the ad spend needed to reach a target revenue.

How it's calculated

ROAS = Revenue ÷ Ad Spend
A ROAS of 4 means £4 revenue for every £1 spent. To find required spend: Spend = Target Revenue ÷ ROAS.

Frequently Asked Questions

What is a good ROAS?: A ROAS of 4x (£4 revenue per £1 spent) is a common minimum target, but the ideal figure depends on your gross margin. A business with 30% margin needs at least 3.33x ROAS to break even on ad spend.
How do I calculate break-even ROAS?: Break-even ROAS = 1 ÷ Gross Margin. For example, with a 25% gross margin: break-even ROAS = 1 ÷ 0.25 = 4x. Any ROAS above this generates a gross profit contribution.
What is the difference between ROAS and ROI?: ROAS only compares revenue to ad spend. ROI is a broader measure that accounts for all costs (production, fulfilment, overheads) against profit, not just revenue versus ad spend.