ROAS formula
ROAS = Revenue from ads ÷ Ad spend
Spend ₹20,000 and earn ₹90,000 → ROAS = 4.5x (450%).
Break-even ROAS
Break-even ROAS = 1 ÷ Profit margin. With a 40% margin you need at least 2.5x ROAS just to cover product costs. Anything above is profit; below means you lose money on every sale.
Typical ROAS benchmarks in India
- Google Search (e-commerce): 4x–8x
- Performance Max: 3x–6x
- Meta (Facebook/Instagram) Ads: 2x–4x
Lead-generation businesses should track cost per lead and lead-to-sale rate instead — try our ad budget & leads calculator.
Find your break-even ROAS
Break-even ROAS = 1 ÷ profit margin
| Gross margin | Break-even ROAS |
|---|---|
| 20% | 5.0× |
| 33% | 3.0× |
| 50% | 2.0× |
| 70% | 1.43× |
So a 3× ROAS is a loss for a shop with a 20% margin, yet healthy for a service business with a 70% margin. That is why there is no universal “good” number.
Why platform ROAS can mislead
- Google and Meta may both claim the same sale.
- Phone and WhatsApp orders may not be counted.
- Returns and cancellations are often not removed.
Reality check: compare ad-platform revenue against your actual sales records every month.
Work out your margin with the profit margin calculator.