Glossary

ROAS — return on ad spend

ROAS is revenue divided by ad spend. What it measures, why it is a poor fit for lead generation, and how it hides the difference between creatives.

ROAS (return on ad spend) is the revenue generated per unit of advertising spend.

ROAS = revenue attributed to ads ÷ ad spend

A ROAS of 4 means €4 of revenue for every €1 spent. It is usually expressed as a multiple (“4x”), sometimes as a percentage.

What it is good for

ROAS is a fast, comparable number for e-commerce, where the conversion happens on the site and revenue is known immediately. It is easy to compute and easy to explain.

Where it breaks

ROAS is not profit. It ignores margin, shipping, returns, payment fees and the cost of the product. A 3x ROAS on a 20% margin product is a loss.

ROAS hides creative differences. Like any blended metric, a single ROAS is an average. It does not tell you which creative or which landing page produced the revenue.

ROAS barely applies to lead generation. If your conversion is a lead, you have no revenue at the moment of conversion — the revenue arrives weeks later, through a sales process. For lead generation, the usable analogues are CPL, CPQL and, if you can join the data, CPA.

  • CPA — cost per acquisition
  • CPL — cost per lead

Last updated: 2026-09-21

FAQ

What is a good ROAS?+

It depends entirely on your margin. A 4x ROAS on a product with 20% margin loses money once you account for costs; a 2x ROAS on a product with 70% margin is profitable. There is no universal threshold.

Keep reading

CPA — cost per acquisitionCPA is the cost of acquiring a paying customer or a completed action, downstream of CPL. How it is calculated and why it is not the same as CPL.CPL — cost per leadCPL is the cost of acquiring one lead. Here is how it is calculated, why the platform number differs from reality, and which one to trust.

Ready to find out what
converts, for real?

Free to start.

Start free →