Return on Advertising Spend (ROAS)

Return on Advertising Spend (ROAS) is a metric that measures how effectively your advertising efforts generate revenue. It is calculated by dividing the sales revenue earned from advertising by the amount spent on those ads. For example, if you spend $100 on ads and make $300 in sales, your ROAS is 3:1 or 300%. A higher ROAS indicates more efficient advertising, meaning each dollar spent is bringing in more revenue. It helps businesses evaluate which campaigns are most profitable and make informed decisions about future advertising investments.