Also known as: Return on advertising spend, Advertising return
ROAS is the ratio between revenue and ad spend — usually expressed as a multiple: a ROAS of 4 means every €1 of ad spend generates €4 in revenue.
ROAS is the most-used KPI for paid social campaigns with a sales goal. A ROAS of 2+ is often seen as the minimum (you double your spend), 4+ as good, 10+ as excellent (typical for e-commerce with high margins).
ROAS vs ROI: ROAS only looks at revenue vs ad spend, while ROI also factors in costs (production, margin, agency fees). A ROAS of 4 with a 25% product margin = a net loss; a ROAS of 4 with a 70% margin = profit. Agencies should talk this through with clients so expectations line up.
The agency runs an Instagram ads campaign for client "Shoe Store": a €2,000 budget generates €8,000 in revenue = a ROAS of 4. The client is happy — the average product margin is 60%, so a ROAS of 4 = profit.
CPM is the cost to show an ad 1,000 times — a key metric for judging the efficiency of paid social media campaigns, independent of conversions.
A measurable value that shows how well a specific goal is being met — for social media that could be engagement rate, reach, follower growth or click-through rate to the website.
A measurable value that shows how well a specific goal is being met — for social media that could be engagement rate, reach, follower growth or click-through rate to the website.
Reach is the number of unique people who saw a post; impressions is the total number of times a post was shown, including multiple views by the same person.
CPM is the cost to show an ad 1,000 times — a key metric for judging the efficiency of paid social media campaigns, independent of conversions.
The number of new followers an account gains over a given period — an important but context-sensitive KPI, because follower quality matters more than quantity.
Systematically tracking and analysing what is said online about a brand, industry or competitor — to spot trends, opportunities and problems early.
The percentage of people who click a link or CTA after seeing a post or ad — a key KPI for lead-gen and e-commerce campaigns.
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