ROAS (Return on Ad Spend) is the ratio showing how much revenue each unit of ad spend brings back. Spend 100 TL on ads and make 400 TL in sales, and your ROAS is 4x. It does not show profitability directly: product cost and overheads are not deducted, so if your margin is thin, even 4x ROAS can mean a loss.
ROAS is the metric marketing teams reach for most often, but on its own it misleads. What actually matters is where your break-even ROAS sits. If your gross margin is 25%, break-even ROAS is 4x — meaning every campaign below 4x is losing money. For a brand running a 60% margin, even 2x ROAS is profitable. That is why ROAS targets differ from sector to sector and cannot be copied.
ROAS = Revenue from ads ÷ Ad spend · Break-even ROAS = 1 ÷ Gross margin
For a brand with a 25% gross margin, break-even ROAS is 1 ÷ 0.25 = 4x. A campaign returning 3.5x ROAS generates revenue but loses money.
ROAS is the metric marketing teams reach for most often, but on its own it misleads. What actually matters is where your break-even ROAS sits. If your gross margin is 25%, break-even ROAS is 4x — meaning every campaign below 4x is losing money. For a brand running a 60% margin, even 2x ROAS is profitable. That is why R…
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