The formula
ROAS = revenue attributed to ads ÷ ad spend. Spending ₹1,00,000 to generate ₹4,00,000 in revenue is a 4x ROAS.
Calculate your break-even ROAS
Break-even ROAS = 1 ÷ gross margin. Anything above that line is contributing profit; anything below loses money on each sale.
Why platform ROAS can mislead
Platforms model conversions in their own favour and may count the same sale twice across channels. Compare platform ROAS with a blended figure: total revenue ÷ total ad spend.
ROAS for lead generation
For lead-gen businesses, track cost per qualified lead and pipeline value instead, then calculate ROAS from closed revenue once deals close.
Frequently asked questions
What is blended ROAS?
Total revenue divided by total ad spend across all channels. It avoids double counting between platforms.
Is 2x ROAS good?
Only if your margin is above 50%. Always compare against your break-even ROAS.
Sources and evidence
Written by
Freelance Performance Marketing & AI Automation Consultant
- 6+ years in performance marketing; ₹1.2Cr+ ad spend managed at 4.6x blended ROAS
- Former Digital Marketing Manager at Vidyavriti, leading a 7-member team
- B.Tech Civil Engineering + MBA Marketing & Finance, Gautam Buddha University
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