Digital Gurus

ROAS (return on ad spend)

Return on ad spend is the revenue your advertising brings in for every pound you spend on it.

Reviewed by Chris Day, COO Last reviewed

Ad spend £300
Revenue from the customers it won £1,200

4:1 The revenue bar holds the spend bar 4 times: £4 back for every £1.

Java Roasters' spend against the revenue it brought in, to scale.

What it means for your advertising

ROAS = revenue from ads ÷ ad spend. A ROAS of 4, often written 4:1 or 400%, means £4 back for every £1 spent.

A shop with online checkout can have the platform report revenue directly. For a service business the sale happens after the enquiry, so you work it out from what the customers you win are worth. ROAS measures revenue, not profit: your margins decide what ROAS you need.

An example

Java Roasters spent £300. 3 of its 10 enquiries became office customers worth £400 a month each: £1,200 of revenue in the first month. £1,200 ÷ £300 = 4, a ROAS of 4:1.

Java Roasters is a fictional business, and its figures are illustrative.

How we handle it

We ask what a customer is worth to you when we plan, so we can judge your campaign on revenue as well as enquiries. Tell us which enquiries became work and we can point budget at what's paying. Our pricing page shows what a campaign costs.

Are you ready to grow your business?

No retainers. No lock-ins. Campaigns when you need them.

Book a strategy call Start in the Guru

Strategy calls run for 30 minutes — bring your business and your goal, we will do the rest.