ROAS vs ROI
ROAS and ROI both ask: was the spend worth it? ROAS is the marketing-channel version; ROI is the broader business answer.
The key difference: ROAS is revenue per ad dollar; ROI is profit per dollar invested, after all costs are stripped out.
| Dimension | ROAS | ROI |
|---|---|---|
| What it measures | Revenue ÷ ad spend | (Profit − cost) ÷ cost |
| Cost basis | Ad spend only | All costs — COGS, ops, salaries |
| Typical user | Performance marketers | CFO, exec team, investors |
| Expressed as | A ratio (e.g. 4:1) or multiple | A percentage |
| Time frame | Per campaign, per channel | Per project, per quarter, per year |
When to use ROAS
Use ROAS to compare ad campaigns and channels in real time.
When to use ROI
Use ROI to evaluate whether a whole investment — campaign, product, hire — earned back its true cost.
FAQs
Can a campaign have great ROAS but bad ROI?
Absolutely. A 5:1 ROAS can still lose money once you add COGS, fulfilment, support and overhead. Margin eats the gap.
What's a good ROAS?
It depends on margin. A 70% margin business can run profitably at 2:1; a thin-margin DTC brand often needs 4–6:1 to break even.
Which should I report to the board?
ROI — it answers the question that matters: did the money come back. Keep ROAS for the marketing team's own optimisation.