How to use the ROAS Calculator
- 1. Enter revenue and spendRevenue the ads brought and what you spent on them.
- 2. Add your marginGross margin after product and delivery costs, plus any agency or tool costs.
- 3. CompareSee whether ROAS is above the break-even level and the profit left.
Worked example
Ads that cost ₹45,000 and brought ₹1,80,000 of sales have a ROAS of 1,80,000 ÷ 45,000 = 4x: ₹4 of revenue for every ₹1 spent, also written as 400%. ROAS alone does not show profit. At a 40% gross margin the sales produce ₹72,000 of gross profit, and after the ₹45,000 ad cost ₹27,000 is left.
Break-even ROAS is 1 ÷ 0.40 = 2.5x. Below 2.5x, the ads cost more than the gross profit they bring; above it, they pay for themselves. ACoS, the share of revenue spent on ads, is 25%.
Using ROAS well
- Set targets from margin, not from industry averages: a 70% margin business can live with a much lower ROAS than a 20% margin one.
- Add other costs such as agency fees and tools; the break-even figure rises to include them.
- Watch attribution: ad platforms often claim sales that would have happened anyway, so compare with your own order data.
- Think lifetime: a low first-order ROAS can still be worth it if customers come back, which the CAC and LTV calculator helps you judge.
Set a target ROAS to see the revenue you would need from the same spend. Turn clicks into expected sales with the conversion rate calculator.
Frequently asked questions
Is ROAS the same as ROI?
No. ROAS uses revenue; ROI uses profit. A 4x ROAS can still be a loss if margins are thin.
What is ACoS?
Advertising cost of sale: ad spend ÷ revenue. It is the inverse of ROAS, used widely on Amazon.
Is the ROAS Calculator free?
Yes, the ROAS Calculator is free. The first time you see your first result, you are asked for your name and WhatsApp number once. After that, this and every other Uncodemy tool opens straight away without the form.