ROAS Calculator
Calculate Return on Ad Spend, Customer Acquisition Costs, and campaign profitability.
Campaign Metrics
Product Margins (For Net profit)
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Campaign Insight
Ready to evaluate campaign efficiency...
ROAS Ratio
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Break-Even ROAS
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CPC (Cost/Click)
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CPA (Cost/Acq)
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Net Profit
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Campaign Ledger
Total Revenue Earned
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Total Advertising Spend
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Estimated COGS
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Net Profit (from Ads)
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Conversion Rate
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ROAS % (Revenue/Spend)
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ROAS Margin Headroom
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ROAS & Advertising ROI Calculator
Analyze Return on Ad Spend, Customer Acquisition Cost (CAC), and CPC efficiency thresholds.
The Economics of Paid E-Commerce Traffic
Paid ads are the lifeblood of scale for modern Shopify and Amazon stores. However, without monitoring your Return on Ad Spend (ROAS), you can easily generate thousands in revenue while netting a loss. You must understand your margins to calculate your "Break-even ROAS"—the exact multiplier where your revenue offsets both your ad spend and your product costs.
Core Marketing Formulas:
- ROAS Formula: $\text{ROAS} = \frac{\text{Total Ad Revenue}}{\text{Total Ad Spend}}$
- Cost Per Acquisition (CPA): $\text{CPA} = \frac{\text{Total Ad Spend}}{\text{Total Conversions}}$
- Break-even ROAS: $\text{Break-even ROAS} = \frac{1}{\text{Profit Margin \%}}$ (expressed as a decimal).
- Customer Lifetime Value (LTV): The total net profit a customer generates during their relationship with your shop.
Key Takeaways
- ROAS only measures revenue, not net profit. A campaign with a high ROAS can still lose money if product margins are thin.
- Cost Per Click (CPC) and Conversion Rate (CVR) are the two primary metrics that determine your CPA.
- Aiming for a ROAS higher than your break-even point is necessary to build a sustainable, growing brand.
This analytical tool is designed for planning purposes. Marketplace fees can fluctuate. Cross-reference metrics with your official sales console.