The Amazon Ecosystem and Terminology
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Return on ad spend or ROAS. It’s one of the easiest revenue based metrics to measure it is simply the total revenue generated for specific marketing channel like PPC divided by the total spend on that channel. The formula is revenue divided by spend equals return on ad spend for example. If you spent $10,000 on paid search in October and generated $40,000 in revenue, your return on ad spend for paid search is $4 to one that is $40,000 divided by $10,000 is $4.
show moreIt tells you if at the most foundational level, a marketing channel is performing at a level that will allow for profitability. Unlike many PPC metrics, the higher your number, the better. That’s because the metric tells you how much revenue you generate of each advertising dollar spent. So a $4 to one means that for every $1 you generate $4 in revenue is $6 to one means that you generate $6 for every dollar you spend.