Plain-language questions
Ask for ROAS (return on ad spend) per month, customer or product in the SQL Explorer with AI. The AI writes the SQL, you see the query and run it yourself; the AI only receives metadata.
KPI · Marketing
ROAS (return on ad spend): formula and example.
ROAS, return on ad spend, is the revenue from advertising divided by ad spend. A ROAS of 4 means every euro of ad budget generates four euros in revenue. It is mainly used to compare campaigns and channels and to allocate budget.
ROAS (return on ad spend) formula
Revenue attributed to ads ÷ ad spend (× 100% when expressed as a percentage)
Worked example
In the third quarter, Acme Groothandel spent €15,000 on Meta Ads. The platform attributed €63,000 in revenue to those campaigns. ROAS is €63,000 ÷ €15,000 = 4.2, or 420%.
Fictitious figures for Acme Groothandel, a sample wholesaler.
How to read this KPI
A higher ROAS means more revenue per euro of advertising. Because ROAS is about revenue rather than profit, set your minimum based on your margin: with a 30% gross margin you need a ROAS of at least 1 ÷ 0.30 ≈ 3.3 to recover the ad spend. Compare ROAS between campaigns with the same goal and the same attribution method.
Pitfalls with ROAS (return on ad spend)
- Reading ROAS as profit, when the cost of goods still has to be deducted.
- Not checking the revenue reported by the ad platform against actual revenue in your accounts.
- Including brand-name campaigns, which often show a high ROAS because the customer would have bought anyway.
SQL & DAX
Calculating ROAS (return on ad spend) in SQL and DAX
Two examples on a fictitious data warehouse for Acme Groothandel: a PostgreSQL query and a measure for a Power BI model. Adjust table and column names to your own model.
SELECT date_trunc('month', spend_date) AS month,
platform,
SUM(cost) AS cost,
SUM(conversion_value) AS conversion_value,
ROUND(SUM(conversion_value) / NULLIF(SUM(cost), 0), 2) AS roas
FROM ad_spend
GROUP BY 1, 2
ORDER BY 1, 2;ROAS =
DIVIDE(
SUM(AdSpend[ConversionValue]),
SUM(AdSpend[Cost])
)In ENABLE
Tracking this KPI in ENABLE
In your Power BI dashboard
Define the KPI as a measure in your Power BI model and show it in the portal, with "Last refreshed" next to it. Access profiles and optional row-level security decide who sees which figures.
Custom dashboards (pilot)
Add the KPI as a tile to a custom dashboard, compared with last year. The Dashboard Builder is a pilot and can be switched on per client.
Monthly targets
With the built-in Targets app you set a target for the KPI per month, so you see actuals and target side by side.
FAQ
Frequently asked questions
How do you calculate ROAS?
Divide the revenue attributed to your ads by your ad spend. With €63,000 in revenue and €15,000 in spend, ROAS is 4.2. As a percentage, that is 420%.
What is the difference between ROAS and ROI?
ROAS compares revenue with ad spend, while ROI compares profit with the total cost of an investment. A ROAS of 4 can therefore still mean a loss if your margin is low. Use ROAS to manage campaigns and marketing ROI to judge whether marketing as a whole pays off.
What is break-even ROAS?
Break-even ROAS is the ROAS at which the gross margin on the revenue exactly covers the ad spend. You calculate it as 1 divided by your gross margin as a fraction. With a 25% gross margin, break-even ROAS is 4.
Further reading
- KPI libraryMarketing KPIs: formulas and examplesMarketing KPIs set reach, cost and conversion side by side. They become truly useful once you link ad and web data to leads and revenue from your CRM and accounting system.Read more
- ResourcesHow to build a KPI dashboard: steps and examplesA KPI dashboard is an overview of the key figures you use to steer towards your goals, such as revenue, margin, on-time delivery or absenteeism. A good KPI dashboard does not start with the software, but with the decisions it needs to support. You then choose a limited number of KPIs, define them, sketch the dashboard and only then build it.Read more
- SolutionPower BI dashboard portal: share dashboards securelyShare your Power BI dashboards securely in your own portal, with role-based access.Read more
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