ADVERTISING ROI
& ROAS CALCULATOR.
Your ads might be generating clicks, leads and sales.
But are they actually making your business money?
Calculate how much revenue your advertising could generate, what each customer costs to acquire and how much profit remains after advertising and direct costs.
Compare return on ad spend (ROAS), advertising ROI, conversion rates and break-even performance.
IS YOUR ADVERTISING
ACTUALLY PROFITABLE?
Enter your monthly advertising budget, expected leads, conversion rate and average sale value.
The calculator updates instantly to show revenue, gross profit, advertising costs, customer acquisition cost and return on investment.
Calculations use expected customers, which may be fractional. Results are estimates before tax, general business overheads, refunds, repeat purchases and unentered expenses. ROAS excludes management fees; CAC and advertising ROI include them.
REVENUE IS ONE THING.
PROFIT IS ANOTHER.
See how much of your estimated advertising revenue goes towards direct costs, advertising and remaining profit.
Bars show each amount relative to revenue, capped at 100% for display. Losses are shown in the results, not as negative bars.
YOUR POTENTIAL
12-MONTH ADVERTISING RESULTS.
Project revenue, ad costs, gross profit and profit after advertising over the next 12 months.
The forecast applies your chosen monthly lead growth rate. Conversion rate, order value, direct cost percentage and monthly advertising budget remain constant.
| Month | Leads | Customers | Revenue | Ad Costs | Profit |
|---|
Forecasts are illustrative, not guaranteed outcomes. A fixed budget does not necessarily produce growing leads, and performance can vary significantly by market, competition and season.
WHAT REVENUE DO YOU NEED
TO HIT YOUR TARGET ROAS?
Set a target ROAS to see the revenue and number of customers required at your current ad spend and average sale value.
WHAT'S THE DIFFERENCE BETWEEN
ROAS AND ROI?
ROAS and ROI are two different ways to measure advertising performance.
ROAS focuses on how much revenue your ads generate compared with the money spent on advertising media.
Advertising ROI goes further by considering the costs of fulfilling sales and running the campaign.
01. ROAS
Return on Ad Spend equals attributed revenue divided by advertising media spend. A 4x ROAS means £4 revenue per £1 media spend.
02. Advertising ROI
Advertising ROI measures profit after direct costs and campaign costs as a percentage of total campaign costs.
03. Customer Acquisition Cost
CAC is total campaign cost divided by acquired customers. Lower CAC can improve profitability, provided customer quality remains strong.
04. Cost Per Lead
Cost per lead is advertising media spend divided by the number of leads. It does not show whether those leads become customers.
05. Conversion Rate
The percentage of leads that become paying customers. Improving conversion can increase revenue without increasing lead volume.
06. Break-Even ROAS
The minimum media ROAS required for contribution profit to cover advertising and campaign costs, based on the entered gross margin.
Example: Spending £500 on Advertising
Imagine a business spends £500 per month on advertising.
The campaign generates 50 leads, and 20% of those leads become paying customers.
That gives 10 customers. Each spends £250, producing £2,500 revenue.
If direct costs represent 30% of revenue, the business has £750 in direct costs and £1,750 gross profit before advertising.
After deducting £500 advertising spend, the campaign generates £1,250 profit after advertising.
That's a 5x ROAS and a 250% advertising ROI.
This is before other business overheads and tax.
HOW TO IMPROVE
YOUR ADVERTISING RETURNS.
Improving advertising performance isn't always about spending more money. It can also mean improving the results you get from your existing budget.
Improve Your Offer
A compelling offer can improve the percentage of people who enquire or make a purchase.
Improve Your Landing Page
A clear, fast landing page with a strong call to action can help turn more visitors into leads.
Follow Up Faster
Responding quickly to enquiries and having a reliable follow-up process can help reduce missed opportunities.
Track Real Customers
Don't rely only on clicks or leads. Track which campaigns generate actual paying customers.
Understand Your Margins
Revenue doesn't equal profit. Consider product, service delivery and fulfilment costs when evaluating ad performance.
Test & Improve
Test audiences, creatives, offers and landing pages. Compare results using consistent attribution and measurement periods.
ADVERTISING ROI & ROAS
FAQS.
What does ROAS mean?
ROAS stands for Return on Ad Spend. It measures revenue attributed to advertising divided by advertising media spend.
How do I calculate ROAS?
Divide attributed advertising revenue by media spend. For example, £2,000 revenue from £500 ad spend gives 4x ROAS.
What is a good ROAS?
A good ROAS depends on your gross profit margin, management costs, business overheads and customer lifetime value. There is no universal target.
What is advertising ROI?
Advertising ROI measures the profit generated after direct costs and campaign expenses, divided by total campaign expenses, expressed as a percentage.
What is break-even ROAS?
Break-even ROAS is the minimum revenue-to-media-spend ratio required for the gross profit generated to cover all entered campaign costs. It depends on your margin and any management fees.
What is customer acquisition cost?
Customer acquisition cost is the amount spent acquiring each paying customer. This calculator includes both media spend and entered campaign management costs.
Can a campaign have high ROAS but lose money?
Yes. A campaign can generate several times its ad spend in revenue but still lose money if product costs, fulfilment and campaign expenses are too high.
Does the calculator include repeat customers?
Not automatically. You can use an average revenue per customer covering a chosen attribution period, but ensure the costs and revenues are measured consistently.
Is this advertising calculator free?
Yes. It is completely free with no registration or payment required.
STOP GUESSING
WHAT YOUR ADS ARE DOING.
Advertising should be measured by the results it produces for your business.
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