Return on Ad Spend (ROAS)

Intermediate 📣 Marketing / Advertising

Definition

The revenue generated for every dollar spent on advertising, assuming your attribution model isn't complete fiction.

Example Usage

We achieved a 3:1 ROAS, which sounded great until accounting corrected our methodology.

Origin

E-commerce and digital marketing metrics, standardized in the 2010s

Fun Fact

A ROAS of 4:1 is considered excellent in most industries, but it varies wildly—some luxury brands operate profitably at 1.5:1.

Source: Digital Marketing Analytics Standards

Related Terms

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CTR

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loss leader

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