What is roas?

Return on ad spend: sales credited to ads, divided by what the ads cost.

ROAS, return on ad spend, divides the sales credited to ads by what those ads cost. A ROAS of 4 means every dollar of spend is credited with four dollars of sales. It’s the headline number in most paid media reports.

The division is easy. The top line is the problem. ROAS uses attributed sales, so it inherits every issue in this glossary: double counting, long windows, view-throughs and brand search. Two channels can both report a strong ROAS on the same sales. And for retail-heavy brands, much of what sells never shows up in any platform’s ROAS at all.

Why it matters

ROAS is only as honest as the sales it’s credited with. If those sales are double counted, ROAS looks better than it is.

An example

Example (made-up numbers): $10,000 of paid social is credited with $50,000 in sales, a ROAS of 5. Matched against your own numbers, $20,000 of those sales also show up in another channel’s report. Counted once, the ROAS is 3.

Where it misleads

Comparing ROAS across channels that each count sales their own way. A 5 from one and a 3 from another may describe the same buyers.

How Arcus handles it

We recalculate ROAS from your own numbers, with each result counted once and one rule for every channel. Where ROAS is the wrong yardstick, like retail media bought for position on the shelf, we say what to judge it by instead.

More in our guide: Google Search ads: how to tell what worked