ROI & ROAS Calculations
Calculating Return on Investment
ROAS Formula:
ROAS = Revenue ÷ Ad Spend
Example: $10,000 revenue ÷ $2,000 ad spend = 5.0x ROAS
Profitability Benchmarks:
- • 2.0x ROAS: Break-even for most businesses (after product costs, overhead)
- • 3.0x ROAS: Moderately profitable
- • 4.0x+ ROAS: Highly profitable - scale aggressively!
- • <2.0x ROAS: Losing money - pause or optimize
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