What Does ROAS Mean in Marketing?

What does ROAS mean?

ROAS stands for “Return On Advertising Spend” and is a metric used to measure the efficiency of digital advertising spend. It shows how much revenue a company makes from each dollar spent on advertising. The higher the ROAS, the more effectively a company is using its ad budget. At Bend Marketing, we use ROAS to evaluate the efficiency of an advertising campaign and to determine whether the campaign is meeting the desired return on investment (ROI). It can also be used to compare the performance of different advertising campaigns and to make decisions about which campaigns to continue or optimize.

What is a good ROAS for Google Ads?

A good ROAS for Google Ads depends on a variety of factors, such as the industry, ad platform, and campaign goals. Generally speaking, a ROAS goal of 2-4x is considered achievable and desirable for most businesses. However, some businesses may find that an even higher ROAS is more appropriate. Ultimately it’s up to you to decide what is best for your business based on your industry and goals.

How to calculate ROAS

ROAS is calculated by dividing the revenue generated by the ad spend. For example, if a company spends $100 on an advertising campaign and generates $500 in revenue as a result, the ROAS would be 500/100 = 5. This means that for every $1 spent on advertising, the company generated $5 in revenue.