What is a good ROAS for ecommerce?

It depends on your margin. Divide 1 by your margin before ad spend to get break even, then set a target above it that leaves your desired profit.

It is profitable if your break even is below 4, meaning your margin before ads is above 25%. For a 20% margin business, 4 loses money.

What is the difference between ROAS and ROI?

ROAS compares ad revenue to ad spend. ROI compares profit to total cost. ROAS ignores product cost and overheads, so it can look healthy when ROI is negative.

Why is my reported ROAS higher than my real sales?

Platforms can count view-through and delayed conversions, or the same sale more than once across channels. Reconcile against your store revenue.

Performance Marketing

What Is a Good ROAS? How to Work Out Your Own Target

People search for "what is a good ROAS" hoping for one number. There is none. A good ROAS is one that leaves profit after your product cost, shipping, fees and ad spend. This guide shows how to work out yours in a few minutes.

By M. Saleem Khan 3 November 2026 4 min read

ROAS in one line

ROAS is return on ad spend: revenue from ads divided by the money spent on ads. Spend 1,000 and earn 4,000 in sales and your ROAS is 4. It does not say whether you made money, because revenue is not profit.

Why there is no universal good ROAS

Two stores can both report a ROAS of 3 and one is profitable while the other loses money on every order. The difference is margin. A store that keeps 60% of the sale price after product cost and shipping can profit at a much lower ROAS than a store that keeps 25%.

Articles that quote a fixed benchmark, such as "4 is good", describe an average of many businesses with different margins. Treat those figures as context, never as your target.

Step 1: find your break even ROAS

Break even ROAS is 1 divided by your margin before ad spend. If you keep 40% of each sale after product cost, shipping, payment fees and returns, break even is 1 / 0.40 = 2.5. Below 2.5 each sale loses money on the first order. Above it, you profit.

25% margin gives break even ROAS of 4.0
40% margin gives break even ROAS of 2.5
50% margin gives break even ROAS of 2.0
60% margin gives break even ROAS of about 1.67

Use our ROAS calculator to do this from your own price, cost and shipping.

Step 2: set a target above break even

Break even only covers costs. Your target should leave room for overheads and profit. A practical way is to choose a profit margin you want after ads, then work backwards. If you need 15 points of margin left after advertising, your target ROAS is 1 divided by (margin minus 0.15). With a 40% margin, that is 1 / 0.25 = 4.0.

Step 3: adjust for repeat customers

If customers buy more than once, the first order can run near break even because later orders are profitable. Brands with strong repeat rates often accept a lower first order ROAS on purpose. Only do this if you can see repeat purchase data. Hoping customers come back is not a plan.

Judging Meta and Google Ads

Platform dashboards report ROAS in their own way. Meta may count conversions that happen days after a view or click, and Google counts conversion value your tracking sends it. Compare reported ROAS with real revenue in your store or CRM before you trust it. Tracking quality matters as much as the number, which is why we start with it in our performance marketing work. If you are comparing agencies, see how to choose a Google Ads agency.