ROAS is revenue from ads divided by ad spend. A campaign that cost €500 and brought €2,500 in orders has a ROAS of 5, or 500%.
Why it is not enough on its own
ROAS counts revenue, not profit. With thin margins even a ROAS of 5 can lose money, with high margins a ROAS of 2 is already profitable. The target ROAS comes from your margin and costs, not from an industry average.
