Return on Ad Spend (ROAS) Calculator

Return on Ad Spend (ROAS) is one of the most critical metrics in digital marketing, especially for businesses investing in paid advertising across platforms like Google Ads, Facebook, Instagram, TikTok, and more. In today’s competitive online marketplace, understanding and optimizing your ROAS can be the difference between a profitable campaign and wasted budget.

In this blog post, we’ll dive deep into what ROAS is, why it matters, how to calculate it, and most importantly—how you can improve it. And to help you get started, we’ve included a free ROAS calculator right here on the page.

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What is ROAS?

ROAS stands for Return on Ad Spend. It measures how much revenue your business earns for every pound (or dollar) spent on advertising.

In simple terms:

ROAS = Revenue from Ads / Cost of Ads

For example, if you spent £100 on an ad campaign and it generated £500 in sales, your ROAS would be:

ROAS = £500 / £100 = 5

That means you earned £5 for every £1 spent on advertising.

Why is ROAS Important?

ROAS is crucial because it gives you a clear picture of your advertising efficiency. Unlike vanity metrics (like impressions or even clicks), ROAS focuses on revenue. It tells you whether your campaigns are actually profitable.

Here’s why tracking ROAS matters:

• ✅ Measure profitability: Understand if you’re earning more than you’re spending.
• ✅ Optimize ad campaigns: Focus on ads that deliver the highest returns.
• ✅ Allocate budget wisely: Invest more into platforms or audiences that generate higher ROAS.
• ✅ Forecast future growth: Use historical ROAS data to project revenue from ad budgets.

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What’s a Good ROAS?

There’s no universal benchmark for a “good” ROAS—it depends on your business model, profit margins, and industry.

However, here’s a rough guide:

Industry	Average ROAS
E-commerce	3:1 to 5:1
SaaS	4:1 to 8:1
Lead Generation	2:1 to 4:1
Info Products	5:1 to 10:1

If your ROAS is below 1, you’re losing money. At 1, you’re breaking even. Anything above 1 means you’re making a return—but whether it’s enough depends on your costs.

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How to Calculate ROAS (with Formula)

Here’s the formula again:

ROAS = Revenue Generated from Ads / Advertising Cost

For example:

• Revenue = £3,000
• Ad Spend = £600
• ROAS = 3000 / 600 = 5

This means for every £1 you spent, you earned £5 back.

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Use Our ROAS Calculator

Want to find out your ROAS quickly? Use our free ROAS calculator below.

👉 [Insert Calculator Here]

Simply enter your total revenue from ads and your ad spend, and the calculator will instantly show your ROAS.

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Tips to Improve ROAS

Improving your ROAS involves optimizing multiple parts of your marketing funnel. Here are some effective strategies:

1. Refine Your Targeting

The more precise your audience targeting, the more likely you are to attract buyers. Use customer data, lookalike audiences, and behavior-based targeting to reach the right people.

2. Optimize Your Creative

Ad creatives make or break your campaign. Test different images, copy, calls-to-action (CTAs), and video formats. A compelling ad can double your click-through and conversion rate.

3. Improve Your Landing Pages

A high bounce rate kills ROAS. Make sure your landing pages:

• Match the ad message
• Load quickly
• Are mobile-optimized
• Have clear CTAs

4. Use Conversion Tracking

Always track purchases, leads, or sign-ups accurately. Use tools like:

• Facebook Pixel
• Google Ads Conversion Tracking
• Google Analytics

5. Focus on Lifetime Value (LTV)

Sometimes a campaign isn’t profitable on the first sale—but becomes profitable when customers return. Retarget, upsell, and nurture email lists to increase LTV and therefore ROAS.

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ROAS vs ROI: What’s the Difference?

While both metrics deal with returns, ROAS focuses solely on advertising, while ROI (Return on Investment) considers all business costs.

• ROAS = Revenue from Ads / Cost of Ads
• ROI = (Revenue – Total Cost) / Total Cost

Use ROAS to optimize marketing; use ROI to understand overall business profitability.

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Final Thoughts: Track, Test, Repeat

ROAS isn’t just a metric—it’s a powerful decision-making tool. By regularly tracking and testing your campaigns, you can improve your performance and make the most of every advertising pound.

Whether you’re a startup with a small budget or an established brand scaling fast, understanding and optimizing your ROAS is essential.

💡 Want help improving your ad performance? At Dabrando, we specialize in data-driven digital marketing strategies that boost ROAS and drive measurable growth. Contact us today to see how we can help.

📧 Looking to increase your ROAS with marketing professionals?

Contact us today at grow@dabrando.co.uk or explore our services to learn more, or Book A Free Discover Call to get started today!