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What is ROAS?

Also known as Return on Ad Spend

ROAS is revenue divided by advertising spend, expressed as a ratio. A ROAS of 4 means $4 of revenue for every $1 spent. It is the reciprocal of ACoS.

Why it matters

ROAS and ACoS describe the same relationship from opposite directions. A 25% ACoS is a ROAS of 4. Amazon sellers tend to use ACoS; advertisers coming from Google or Meta tend to use ROAS.

Convert between them by dividing 1 by the other: ROAS = 1 ÷ ACoS. Neither tells you about profit without knowing your margin.

Related

Terms that come up alongside this one

ACoS
ACoS is advertising spend divided by the revenue that advertising generated, expressed as a percentage. An ACoS of 25% means you spent $25 on ads for every $100 of ad-attributed sales.
TACoS
TACoS is advertising spend divided by total revenue — organic and ad-driven combined — rather than by ad-attributed revenue alone. It shows whether advertising is growing the business overall.

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