ROAS: the number, and what it hides
Revenue produced per unit of ad spend.
Why roas matters
It is the common currency between marketing and the rest of the business, and it scales: a ROAS target is a ceiling on what you can pay for a customer.
What this looks like with real numbers
The platform reports ROAS of 4.2 on a 7-day-click, 1-day-view window. Your analytics, on last click, reports 2.1 for the same period. Neither is lying; they are answering different questions, and the finance team's number is usually closer to the second.
What it does not tell you
A ROAS figure is only as good as its definition. Platform-reported or from your own analytics; first purchase or lifetime; attributed over 1 day or 28. Two teams quoting 'ROAS 3' can be describing performance that differs by a factor of two. State the definition or do not quote the number.
The mistake people actually make
Quoting a ROAS without its definition. Platform or analytics, first purchase or lifetime, 1-day or 28-day: the same campaign can honestly be described as 2 or as 4.
Questions, answered.
How do you calculate roas?
Attributed revenue ÷ ad spend. Revenue produced per unit of ad spend.
What goes wrong with roas?
Quoting a ROAS without its definition. Platform or analytics, first purchase or lifetime, 1-day or 28-day: the same campaign can honestly be described as 2 or as 4.
What does roas not tell me?
A ROAS figure is only as good as its definition. Platform-reported or from your own analytics; first purchase or lifetime; attributed over 1 day or 28. Two teams quoting 'ROAS 3' can be describing performance that differs by a factor of two. State the definition or do not quote the number.
Change the creative, not the dashboard
Revenue produced per unit of ad spend.