Calculate return on ad spend, ROI percentage, and break-even point. Industry benchmarks included.
ROAS = Ad Revenue ÷ Ad Spend. A 3x ROAS means every $1 spent on ads generates $3 in revenue. Break-even is 1.0x — below that you lose money. E-commerce averages 3-4x, SaaS averages 2-3x, B2B services average 1.5-2x. Note: ROAS measures revenue, not profit — a 3x ROAS with 50% product margin yields only $0.50 profit per $1 spent. Profitable ROAS = 1 ÷ Gross Margin %. At 50% margin, you need 2x ROAS to break even on profit.
Sources: WordStream 2025, HubSpot, Shopify. Benchmarks are medians across industries.
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Get the Template| Metric | Value | Source | Test Conditions |
|---|---|---|---|
| ROAS Formula | Revenue ÷ Ad Spend | Industry Standard | Direct attribution model |
| Ad-level Break-even ROAS | 1.0x | Mathematical | Ad revenue equals ad spend only; does not include product costs |
| E-commerce Average ROAS | 3-4x (avg 3.5x) | WordStream 2025 | Google Ads + Meta, DTC brands |
| SaaS Average ROAS | 2-3x (avg 2.5x) | HubSpot 2025 | B2B SaaS, LinkedIn + Google |
| B2B Services Average ROAS | 1.5-2x (avg 1.75x) | OpenView 2025 | Agencies, consulting, long sales cycles |
| Profitable ROAS Threshold | Above 2x for most | Shopify | Assumes 50% gross margin |
| ROI vs ROAS | ROI = (Revenue - Spend) ÷ Spend | Industry Standard | ROI includes profit, ROAS is revenue multiple |
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| Dimension | This Calculator | Excel Spreadsheet | Paid Analytics Tool |
|---|---|---|---|
| Cost | Free | Free (if you have Excel) | $50-500/month |
| Setup Time | 10 seconds | 15-30 minutes | 1-2 weeks integration |
| Industry Benchmarks | Built-in (5 industries) | Manual research required | Sometimes included |
| ROI + ROAS | Both calculated | Manual formulas | Usually both |
| Data Privacy | 100% local browser | Local file | Data sent to vendor servers |
| Best For | Quick checks, pitching | Complex modeling | Enterprise reporting |
ROAS = Total Ad Revenue ÷ Total Ad Spend. For example, if you spend $5,000 on ads and generate $15,000 in revenue, ROAS = $15,000 ÷ $5,000 = 3.0x. This means every dollar spent on ads returned three dollars in revenue.
It depends on your industry and gross margin. E-commerce: 3-4x is average, above 5x is excellent. SaaS: 2-3x is average due to longer sales cycles. B2B services: 1.5-2x is typical. The real question is whether your ROAS exceeds your break-even threshold: Break-even ROAS = 1 ÷ Gross Margin %. At 50% margin, you need 2x ROAS to break even on profit.
ROAS (Return on Ad Spend) = Revenue ÷ Spend (revenue multiple). ROI (Return on Investment) = (Revenue - Spend) ÷ Spend × 100 (profit percentage). A 3x ROAS equals a 200% ROI. ROAS tells you the revenue multiplier; ROI tells you the actual profit percentage. Both are useful — ROAS for media buying, ROI for business decisions.
Break-even ROAS = 1 ÷ Gross Margin Percentage. If your gross margin is 60%, break-even ROAS = 1 ÷ 0.60 = 1.67x. At 50% margin, it's 2.0x (this is why the Core Data table shows 2x as the typical profitable threshold). Higher margin means lower break-even ROAS. Always use gross margin (after product costs), not revenue margin, for this calculation.
No. ROAS should only include revenue directly attributed to paid ads. Including organic revenue inflates ROAS and makes ads look more efficient than they are. If you want to measure total business efficiency, use a blended metric: Total Revenue ÷ Total Marketing Spend (paid + organic labor).
Weekly for active campaign optimization, monthly for business reviews. Daily ROAS is too noisy due to attribution delays and conversion lag. For businesses with long sales cycles (SaaS, B2B), use monthly or quarterly ROAS and supplement with leading indicators like cost per lead (CPL) and conversion rate.
Common causes: ad fatigue (same audience seeing same ads), increased competition (auction prices rising), seasonality, landing page performance drops, or attribution window changes. First check frequency caps and creative refresh schedule, then compare auction metrics (CPM, CPC) to previous periods.
No. All calculations run locally in your browser. Your ad spend and revenue numbers are never sent to our servers or any third party. Page visit analytics (anonymous, no input data) may be collected by Cloudflare. Your financial metrics never leave your device.
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