What is ROAS?
ROAS (Return on Ad Spend) measures how much revenue you earn for every unit of currency spent on ads. Important: this is revenue, not profit.
Formula
Example
If you spent $1,000 on Google Ads and generated $5,000 in revenue, your ROAS = $5,000 / $1,000 = 5.0x. But if COGS is $2,500, shipping $500, and payment fees $150, your actual profit is only $850.
Breakeven ROAS Calculator
Calculate the minimum gross revenue each $1 of ad spend must generate to break even.
CM1 (Product Margin)
55.0%
CM2 (Order Margin)
45.4%
Breakeven ROAS
2.20x
For every $1 of ad spend, you need at least this much gross revenue to cover all variable costs.
Quick reference
Breakeven ROAS at different CM2 margins
| CM2 Margin (net) | Breakeven ROAS |
|---|---|
| 20% | 5.00x |
| 25% | 4.00x |
| 30% | 3.33x |
| 35% | 2.86x |
| 40% | 2.50x |
| 45% | 2.22x |
| 50% | 2.00x |
| 60% | 1.67x |
| 70% | 1.43x |
Margyn calculates contribution margin alongside ROAS, so you see real profit on every campaign.
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Related Terms
CPC (Cost Per Click)
CPC shows how much you pay on average for a single ad click. The e-commerce average is $1.16 on Google Ads and $0.45–1.72 on Meta Ads.
CPA (Cost Per Acquisition)
CPA shows the cost of acquiring a single purchase through advertising. CAC is broader: it includes all marketing costs.
Attribution
Attribution determines which ad channel gets "credit" for a sale. Your choice of model dramatically affects what you think about your campaign performance.
MER (Marketing Efficiency Ratio)
MER divides total revenue by total marketing spend — a platform-independent "blended ROAS." Shows overall marketing efficiency without attribution modeling.