ROAS
Business & Finance abbreviation · Marketing & Advertising
| Stands for | Return on ad spend |
|---|---|
| Categories | Business & Finance |
ROAS stands for Return on ad spend, a marketing & advertising abbreviation.
Revenue generated by advertising divided by the amount spent on it, expressed as a ratio (4:1), a multiple (4x) or a percentage (400%). It measures the efficiency of campaigns, ad groups or channels.
Example: Prospecting ads run at 2.5x ROAS, while retargeting returns about 8x.
Usage notes
ROAS uses revenue, not profit, so a business with a 25% margin needs at least 4x just to break even on ad costs (1 divided by the margin). Unlike ROI, it ignores product, shipping and overhead costs. Platform-reported ROAS often overstates impact because ads get credit for sales that would have happened anyway, which is why marketers run incrementality tests. Pronounced "ROH-az."
Related abbreviations
More marketing & advertising abbreviations
- POD – Point of difference
- POP – Point of purchase
- PPC – Pay-per-click
- PQL – Product-qualified lead
- PR – Public relations
- RFM – Recency, frequency, monetary value
- ROMI – Return on marketing investment
- RPM – Revenue per mille
- RTB – Real-time bidding
- SAL – Sales-accepted lead
- SEA – Search engine advertising
- SEM – Search engine marketing