How to Calculate Return On Advertising Spend - Tutorial, Definition, Formula, Example

How to Calculate ROAS - Tutorial

Return On Ad Spend (ROAS) is a revenue based metric which is used to evaluate the efficacy of online advertising campaign.

ROAS = (Revenue value - Ad spend value) /Ad spend value Where, ROAS - Return on Ad Spend

Hiox spent $20,000 on paid search in November, and generated $60,000 in revenue. Find the ROAS value of the company ?

Revenue value = $60,000 Ad spend value = $20,000

Substitute the values in the formula,

ROAS	= (Revenue value - Ad spend value) /Ad spend value
	= ($60000 - $20000) / $20000
	= $2