ROAS, short for “Return On Ad Spent,” measures the return on advertising expenditure in terms of revenue or percentage. For example, a ROAS of 10% or 1000% indicates that €100,000 invested in a campaign generated €1,000,000 in additional revenue. Advertisers use it to evaluate the effectiveness of their marketing campaigns, while marketing service providers use it to highlight the effectiveness of their solutions. However, the simplistic calculation of ROAS does not take into account the profitability of acquired customers or the profit margin generated, which limits its relevance. These shortcomings are discussed in detail in analyses dedicated to the reliability of ROAS. ROAS is closely linked to the optimization of marketing campaigns.
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