ROAS (Return on Ad Spend) measures how much revenue your ads generate for every rupee spent:
ROAS = revenue attributed to ads ÷ ad spend
A ROAS of 4 (or 4×) means ₹4 of revenue for every ₹1 of ad spend.
Why it matters
ROAS tells you whether campaigns are paying back and where to shift budget. But ROAS isn't profit: you also need to account for product costs, shipping, returns, fees and management costs.
Break-even ROAS
Break-even ROAS = 1 ÷ gross margin (as a decimal). If your gross margin is 40%, you need a ROAS of at least 2.5 just to break even on ad spend.
Measuring it properly
- Use conversion tracking (Meta Pixel, Google Ads tag) and UTMs
- Track offline and WhatsApp sales back to campaigns where possible
- Compare ROAS by campaign, audience and creative
- Watch customer lifetime value, because some channels win on repeat purchases
Example
A D2C brand spends ₹50,000 on Meta ads and records ₹2,00,000 in attributed revenue, a ROAS of 4. With a 50% gross margin (break-even ROAS 2), the campaign is profitable before other costs.
In RapBooster
RapBooster's Performance Ads management starts at ₹8,000/mo per platform (for ad spend up to ₹20K/mo), excl. GST, with your ad budget paid directly to the platform.
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