ROAS vs. ROI: What Each Metric Actually Tells You
ROAS measures advertising efficiency while ROI looks at profit relative to total investment. Here's when to use each.
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ROAS and ROI sound similar, but they answer different questions.
ROAS measures advertising efficiency
Return on ad spend compares revenue generated by advertising with the amount spent on ads.
If you spend $1,000 on ads and generate $4,000 in tracked revenue, the campaign has a 4.0x ROAS.
ROI looks at the broader investment
ROI considers the return after costs, which can include more than media spend. Depending on the analysis, that might include labor, software, creative production, fulfillment, or other expenses.
Which should you use?
Use ROAS when you want to compare the efficiency of media spend. Use ROI when you want to understand whether the overall investment is financially worthwhile.
The TrafficCampaign calculators let you calculate both in seconds.