ROI vs ROAS: What's the Difference?
ROI and ROAS sit side by side in every ads dashboard, and they are not the same thing. ROAS measures revenue against ad spend alone; ROI measures profit against everything you spent.
ROI
Profit as a percentage of what you spent, across all your costs.
ROI % = (revenue − spend) ÷ spend × 100ROAS
Revenue as a multiple of advertising spend only.
ROAS = revenue ÷ ad spendSide by side
| ROI | ROAS | |
|---|---|---|
| What it divides | Profit ÷ total spend | Revenue ÷ ad spend |
| Unit | Percentage (%) | Multiple (x) |
| Includes other costs? | Yes — product, overheads, fees | No — ad spend only |
| Example: spend 50k, revenue 150k | 200% ROI | 3.0x ROAS |
| Best for | Judging whether a campaign was worth it | Optimising ad delivery day to day |
Worked example
Inputs: Ad spend 50,000, revenue 150,000
ROI: 200%
ROAS: 3.0x
The campaign tripled revenue, but ROAS can't see the product cost — only ROI tells you whether it actually made money.
When to use ROI
Use ROI for the business decision: did this campaign, hire, or purchase beat what the money cost you? It's the number that survives once every cost is counted.
When to use ROAS
Use ROAS when tuning ads. It isolates the ad account, so you can compare creatives, audiences, and channels without dragging product costs into the comparison.
The short answer
A healthy ROAS can still be an unprofitable campaign. Track ROAS to optimise ads day to day, but make the go/no-go call on ROI.
Run the numbers
Frequently asked questions
Quick answers before you start.
Can a campaign have a good ROAS but a bad ROI?
Yes. If product cost, shipping, and overheads are high, a 3x ROAS can still lose money once those are subtracted, because ROAS never sees them. ROI does.
Which should I report to stakeholders?
ROI, or both together. ROAS flatters a campaign by ignoring costs, while owners and investors care about profit. Showing both prevents a good-looking ROAS from hiding a loss.
Is ROAS always revenue divided by ad spend?
In most ad platforms, yes. Some report a marginal ROAS that counts only new-customer revenue, so check the platform's definition before comparing numbers across tools.