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ROAS tells you how much money you’re getting in return for every dollar you spend on advertising. It’s an essential metric for evaluating how well your advertising campaigns performed and how they contribute to your store’s bottom line. Calculating ROAS and using that data helps ecommerce companies increase clicks — driving traffic and hopefully boosting sales.

To help keep costs in check, marketing professionals often use a target ROAS when planning campaigns. To estimate how much revenue you expect to get back from an ad spend, reverse engineer the formula. (Advertisers, for example, often do this to develop a target ROAS for their Google AdWords campaigns.)

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Jeren Scott

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4y ago

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