Marketing ROI & ROAS Calculator
Evaluate advertising campaign profitability, compute Return on Ad Spend (ROAS), determine Customer Acquisition Cost (CAC), and assess LTV ratios.
Campaign Revenue & Costs
Core Growth & Ad Performance Formulas
ROAS (Return on Ad Spend)
ROAS = Total Revenue / Direct Ad Spend
Measures gross revenue generated for every $1 spent on advertising. For example, $20,000 revenue on $5,000 ad spend = 4.0x ROAS (400%).
Marketing ROI (%)
ROI = [(Revenue - Total Costs) / Total Costs] × 100
Unlike ROAS, ROI factors in agency fees, software subscriptions, creative production, and overhead for true net bottom-line profitability.
LTV:CAC Ratio (Golden Rule)
Optimal Target: 3.0x to 5.0x
An LTV:CAC ratio of 3:1 means customers generate 3x what it costs to acquire them. A ratio below 1:1 indicates unprofitable acquisition.
Frequently Asked Questions
What is the difference between ROI and ROAS?
ROAS measures gross revenue generated directly by ad spend, while ROI accounts for all campaign expenses (agency fees, product margins, software) to calculate actual net profit percentage.
What is a good ROAS for ecommerce vs SaaS?
For ecommerce with physical inventory costs, a 3.0x to 4.0x ROAS is typically needed to break even. For high-margin digital SaaS products, a 2.0x to 2.5x ROAS is often highly profitable.
How is Customer Acquisition Cost (CAC) calculated?
CAC is calculated by dividing total sales and marketing spend over a given period by the total number of new customers acquired during that same timeframe.