ROAS

ROAS means return on ad spend. It compares revenue generated from advertising with the advertising spend used to create that revenue.

ROAS can be misleading

A high ROAS can still be unprofitable if product cost, fees, shipping, and returns are high. A lower ROAS can work for products with strong repeat purchase behavior or high contribution margin.

Better planning

Convert ad spend into ad cost per order, then test it in the relevant profit calculator.

Use it in a calculator

After reviewing this term, open the marketplace calculator hub or country calculator hub and test the number with a realistic product scenario.