How much does branding cost in the UK?
Men from MarsWhat ROAS do you need to break even?
Enter your average order value and gross margin. You get the ROAS and the cost per sale your ads must beat to make money. Free, with no sign-up.
Your numbers
Break-even ROAS
Most you can pay per sale and break even
If your numbers sit below the line and the product is sound, the usual cause is upstream: who the ads speak to and what they promise. That is brand strategy, and it is where we start.
How the calculation works
Break-even ROAS is 1 divided by your gross margin. At a 40% margin, every £1 of ad spend must bring back £2.50 of revenue just to cover itself, so break-even ROAS is 2.5x. The most you can pay for one sale is your order value multiplied by your margin.
To keep a profit, the calculator takes your target away from your margin first. A 40% margin with a 10% profit target leaves 30% to spend on ads, so you need 3.33x.
Why a ROAS target needs your margin
Two businesses can report the same ROAS and one loses money while the other grows. The difference is margin. A figure quoted without it tells you nothing, which is why a campaign can look healthy in the ad platform and still not pay for itself.
This tool covers the first order only. Repeat purchases, returns and delivery costs all move the real answer, and our guide to measuring marketing ROI shows how to account for them.
When the numbers do not work
If your ads cannot reach the ROAS you need, bidding harder rarely helps. The cause is usually who the ads speak to and what they promise, which is a strategy question. Read why marketing spend stops working, or see how brand and performance marketing fit together.
Ready to start? Tell us where the business is today.
Frequently asked
What is a good ROAS?
There is no single good ROAS. It depends on your margin. Divide 1 by your gross margin to find your break-even, and anything above it earns a profit on the first order.
What is the difference between ROAS and ROI?
ROAS is revenue divided by ad spend. ROI is profit divided by cost, so it accounts for what the product cost to make and deliver. A ROAS can look strong while the ROI is negative.
Does this include repeat customers?
No. It looks at the first order only. If customers buy again, you can afford a lower first-order ROAS, but only if you have the repeat purchase data to back it.
Is my data stored?
No. The calculation runs in your browser and nothing you enter is sent to us.
Guides to read first
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Ads not paying for themselves?
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