Return on Advertising Spend (ROAS) is the amount of revenue a company receives for every dollar spent on an advertising campaign. ROAS is a very important key-performance-indicator (KPI) to gauge the effectiveness of online advertising campaigns. The higher your return, the more effective the campaign.
This is the formula to calculate return on ad spend:
ROAS = (Revenue derived from ad campaign) / (Cost of ad source)
ROAS can be an extremely helpful KPI for businesses when used correctly. It can help you to determine whether your advertising campaigns are turning a profit, and exactly how much.
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