Profitable — you are above break-even.
Enter the numbers from your ad platform and your real gross margin (after COGS, shipping and payment fees).
Enter ad spend, attributed revenue and gross margin to get your ROAS, the break-even ROAS your margin demands, and the profit left after advertising.
Divide the revenue a channel is credited with by what you spent on that channel in the same period. €20,000 in revenue on €5,000 in spend is a 4x ROAS, sometimes written as 400%.
Use one attribution setting and one time window for every channel you compare. Mixing a 7-day click window on Meta with last-click in GA4 produces two different truths about the same month.
| Ad spend | Attributed revenue | ROAS |
|---|---|---|
| €1,000 | €2,000 | 2.0x |
| €5,000 | €20,000 | 4.0x |
| €10,000 | €25,000 | 2.5x |
| €30,000 | €45,000 | 1.5x |
Break-even ROAS is one divided by your gross margin expressed as a decimal. At a 50% margin, break-even is 2.0x. At a 25% margin it is 4.0x — the same 3x ROAS is excellent for one store and loss-making for the other.
Use gross margin after cost of goods, shipping, packaging, payment fees and expected returns. Margins calculated before those costs are the single most common reason a 'profitable' account is quietly losing money.
| Gross margin | Break-even ROAS | Target for healthy profit |
|---|---|---|
| 20% | 5.0x | 6.5x+ |
| 30% | 3.3x | 4.5x+ |
| 40% | 2.5x | 3.3x+ |
| 50% | 2.0x | 2.7x+ |
| 60% | 1.7x | 2.2x+ |
| 70% | 1.4x | 1.9x+ |
Targets assume you want roughly 30% headroom above break-even to cover overheads and variance.
Platform ROAS is what Meta or Google reports for its own campaigns. Blended ROAS is total revenue divided by total ad spend across every channel — it cannot be inflated by overlapping attribution. MER (marketing efficiency ratio) is the same calculation expressed from the marketing side, and ACOS is ad spend as a percentage of revenue, the inverse of ROAS.
A below-break-even account is rarely fixed by cutting spend alone. In the accounts we take over, the recurring causes are broken or partial conversion tracking, creative fatigue on the top-spending ad, and budgets spread across too many campaigns to exit the learning phase.
There is no universal number. A good ROAS is any ROAS comfortably above your break-even ROAS, which is 1 divided by your gross margin. Most eCommerce brands we work with operate profitably in a 2.5x–6x band; high-margin digital products can profit below 2x, and low-margin retail may need 5x or more.
Break-even ROAS = 1 ÷ gross margin as a decimal. A 40% gross margin gives 1 ÷ 0.4 = 2.5x. Below 2.5x that account is losing money on every order, regardless of what the platform dashboard celebrates.
No. ROAS measures revenue returned per unit of ad spend and ignores product and operating costs. ROI measures profit against total investment. A 3x ROAS can be a negative ROI when margins are thin.
Use platform ROAS to make decisions inside a channel and blended ROAS to decide how much to spend overall. Platforms each claim the same conversion, so the sum of platform ROAS always flatters reality.
Usually because fewer conversions are being attributed, not because fewer sales happened. Implementing the Conversions API with hashed first-party data typically recovers a meaningful share of the reported conversions within weeks.
We run a free ad account audit: tracking accuracy, true break-even ROAS, and where the wasted spend is sitting.
One offer, no pressure
Meta, Google or TikTok — a senior specialist reviews your account and sends a concrete growth plan within 48–72 hours of access. No obligation, no lock-in.