A higher ROAS is one useful observation. To understand the account, you need the rest of the picture.
Start with what the number measures.
ROAS is attributed purchase value divided by ad spend. A reported 4.91× means the reporting system attributes 4.91 in purchase value for each 1 spent on advertising. That calculation does not subtract product costs, fulfilment or returns.
ROAS formula: a worked example.
ROAS = attributed advertising revenue ÷ advertising spend. If a campaign records PKR 100,000 in attributed revenue against PKR 20,000 in ad spend, ROAS is 5×. Expressed as a percentage, that is 500%. Use revenue and spend from the same period and the same currency.
You can calculate this in a spreadsheet by dividing the revenue cell by the spend cell. If spend is zero, the ratio is undefined; it should not be reported as a normal ROAS result.
Break-even ROAS depends on your margin.
A simplified break-even ROAS is 1 ÷ contribution margin before advertising, with the margin written as a decimal. At a 40% margin, break-even ROAS is 2.5×. This assumes the margin already accounts for the variable costs relevant to those sales, and it does not by itself cover fixed overhead or establish profit.
For a cash-on-delivery business, check whether reported purchase value includes cancelled or returned orders. Estimated revenue, collected revenue and profit are different numbers.
A short checklist before comparing two ROAS figures.
- Match reporting dates, period lengths, currency and attribution settings.
- Check whether the purchase value includes tax, shipping, cancellations or returns.
- Compare spend, purchases, average order value and acquisition cost together.
- Review product margins and fulfilment before deciding to scale.
Need help interpreting your report? Start with a Facebook or Google Ads account audit, or bring the question to one-to-one mentorship.
Read the neighbouring numbers.
In the first comparison in my portfolio, ROAS moves from 3.01× to 4.91×. Purchases move from 567 to 961. Cost per purchase also rises, from PKR 1,304.14 to PKR 1,536.03.
All three observations matter. Describing that pair as cheaper customer acquisition would ignore the cost-per-purchase figures.
Check whether the views are comparable.
Look for reporting dates, period lengths and attribution settings. Those details are not visible in the portfolio screenshots, so I present them as account snapshots rather than equal-period growth comparisons.
Bring the business into the discussion.
Ask what happened to product mix, order value, margins, cancellations and fulfilment. A campaign report is one input to a commercial decision. Understanding what the business actually keeps requires more information.