## Understanding Return on Ad Spend (ROAS)

Written by Brandon Kane

Updated this week

The first part of understanding Return on Ad Spend is the difference between Revenue and Return.

Let's say you have a campaign with a $1,000 budget on Vantage. That means $870 of ad spend.

Assuming you get the average return, you'll have a 10X return on ad spend.

Here's how we calculate that.

Revenue = Gross sales that were attributed to the campaign

Return = Revenue minus ad spend

First we calculate the Return by subtracting Ad Spend from the revenue:

Return = Revenue - Ad Spend

Return = $9,570 - $870

Return = $8,700

Then to calculate the Return on Ad Spend we divide the Return by the Ad Spend:

Return on Ad Spend = Return / Ad Spend

Return on Ad Spend = $8,700 / $870

Return on Ad Spend = 10X

Calculating ROAS is essential to understanding the success of your social ad campaigns. Once ads are optimized you should always be getting more than you put in!