How to use this calculator
Enter your media spend and attributed revenue to calculate your ROAS instantly. Click Try an example to load sample data (PKR 100,000 spend, PKR 400,000 revenue). Expand Check contribution after costs to factor in product costs, shipping, fees and COD returns for a full profitability check.
What is ROAS?
Return on ad spend (ROAS) measures how much revenue you earn for every unit of currency spent on advertising. It is calculated as attributed revenue divided by media spend. A 4.00x ROAS means you earn PKR 4 in revenue for every PKR 1 spent on ads.
ROAS formula and example
Formula: ROAS = Attributed revenue / Media spend
Example: PKR 400,000 revenue / PKR 100,000 spend = 4.00x ROAS.
What is a good ROAS?
A good ROAS depends on your profit margins. With a 50% variable margin, you need at least 2.00x ROAS to break even on ad spend. Higher margins allow lower ROAS targets, while low-margin businesses need higher ROAS to stay profitable.
Break-even versus target ROAS
Break-even ROAS is the minimum return needed to cover your costs. Target ROAS adds your desired profit margin on top. This calculator shows both once you enter your cost details.
COD returns and collected revenue
For cash-on-delivery businesses, not all attributed revenue is collected. If 20% of revenue is lost to returns or RTO, a 4.00x reported ROAS becomes 3.20x on collected revenue. Always plan using collected revenue, not just reported revenue.
ROAS versus ROI, CPA and MER
ROAS measures revenue per ad spend, while ROI measures profit per total investment. CPA (cost per acquisition) tracks cost per customer. MER (marketing efficiency ratio) is total revenue divided by total marketing spend across all channels.
Questions
Does this calculator account for product costs?
Yes. Expand the cost section to enter your variable margin or detailed costs (COGS, shipping, packaging, fees). The calculator then shows contribution after costs, not just ROAS.
Can I compare scenarios?
Yes. Use the scenario comparison tool to duplicate your current assumptions and test changes to return rates, margins or CPA.
Methodology and references
This calculator computes reported ROAS as attributed revenue divided by media spend. Collected-revenue ROAS adjusts for uncollected revenue share. Contribution is calculated as (collected revenue x variable margin) minus media spend minus fixed costs. All calculations run in your browser; no data is sent to any server.