Return on Advertising Spending / Marketing Terms Return on Advertising Spending Return on advertising spending (ROAS) is a key performance metric that measures the revenue generated for every dollar spent on advertising. It helps marketers evaluate the effectiveness and profitability of their campaigns by comparing ad costs to the income they generate. ROAS is essential for budget planning, channel optimisation and understanding the impact of paid media efforts. ROAS is calculated by dividing the revenue from an advertising campaign by the total amount spent on that campaign. For example, if a business earns $10,000 in revenue from a Google Ads campaign that cost $2,000, the ROAS is 5.0. This means the company earned five dollars for every dollar spent. Different platforms, industries and campaign types may have different ROAS benchmarks. A higher ROAS generally indicates more efficient ad spending, but it should also be weighed alongside other metrics like customer lifetime value, conversion rate and attribution model. For B2B and SaaS companies, ROAS helps track the return from lead generation or product launch campaigns across platforms like LinkedIn, Google and YouTube. For nonprofits, it can be used to assess how effectively fundraising or awareness ads convert impressions into donations or sign-ups. Improving ROAS involves refining targeting, testing ad creatives, optimising landing pages and aligning messaging with user intent. Analytics tools like Google Ads, Meta Ads Manager and marketing dashboards provide detailed ROAS data to support real-time adjustments.