Ad Spend ROI Calculator
Stop confusing ROAS with profit. This calculator helps you determine if your ad spend is actually generating a net positive return after all costs are considered.
Total amount spent on advertising campaigns
Total sales attributed to the ad spend
The cost to produce or source the items sold
Shipping, payment fees, or software costs
What is Ad Spend ROI and how is it different from ROAS?
Return on Ad Spend (ROAS) only measures gross revenue generated per dollar spent on ads. Return on Investment (ROI) is more comprehensive—it subtracts the cost of the goods sold (COGS) and other operating expenses from the revenue, then divides by the ad spend. ROAS tells you if your ads are driving sales; ROI tells you if those sales are actually making you money.
What is a "good" ROI for digital advertising?
A "good" ROI varies by industry and product margin. For high-margin digital products, a 300-500% ROI is common. For low-margin physical goods, a 100-200% ROI might be the goal. Generally, any ROI above 100% means you are making a profit after recovering your ad spend. The key is to ensure your ROI exceeds your cost of capital and time.
How can I improve my ad spend ROI?
To increase ROI: 1. Improve your ad copy and creatives to increase the Click-Through Rate (CTR). 2. Optimize your landing page for higher conversions (CRO). 3. Refine your audience targeting to reach higher-intent buyers. 4. Increase the Average Order Value (AOV) through upselling and cross-selling. 5. Focus your budget on the highest-performing campaigns and cut the losers.
Does this calculator account for attribution lag?
No, this calculator uses a snapshot of data. In reality, many customers see an ad today but don't purchase for several days or weeks (attribution lag). To get a truly accurate ROI, it is recommended to analyze data on a 30-day or 60-day rolling window rather than looking at daily snapshots.