Understanding your Return on Ad Spend (ROAS) is crucial for maximising the effectiveness of your Advertising effects. To aid in this endeavor, we at Juno have recently launched a ROAS calculator designed to provide you with an in-depth view of your Shopify store's performance and the returns you're achieving on your advertising campaigns.

What is ROAS?

ROAS is a key performance indicator that measures the revenue generated for every Pounds, Dollars or Euros spent on advertising. It's calculated by dividing the revenue from ad campaigns by the cost of those campaigns. For example, if you spend £100 on ads and generate £500 in revenue, your ROAS is 5:1. This metric helps you understand the effectiveness of your advertising efforts, allowing you to allocate your budget more efficiently, understand what ads are resonating with the target audience and overall, what are the profitable campaigns within your advertising efforts.

Why is ROAS Important? 

1. Financial Insight: ROAS provides a clear picture of which campaigns generate the most revenue, allowing you to invest more in high-performing campaigns.
2. Budget Allocation: By identifying the most profitable campaigns, you can reallocate your budget to ads that are resonating with the target audience and generating overall returns.
3. Performance Benchmarking: ROAS offers a standard for comparing different campaigns, helping you understand which strategies are working best for your business. Find out More here.

According to Shopify, a good ROAS ratio is typically considered 4:1, meaning $4 in revenue for every $1 spent on advertising. However, the ideal ratio can vary based on the company's unique cost structure and goals.

Making Data-Driven Decisions

Closely monitoring your ROAS allows you to gain valuable insights into your campaign ad performance and marketing health. Use our ROAS calculator to dive deeper into your numbers, enabling you to make data-driven decisions that can significantly improve your advertising strategies.

Calculating ROAS: The Formula

The ROAS formula is quite simple,: ROAS = Revenue from Ad Campaigns / Cost of Ad campaign While the ROAS formula is straightforward, manually calculating ROAS for multiple campaigns can be time-consuming and prone to error. This is where our ROAS calculator comes in handy. Giving you the option to include costs like cost of goods, shipping and fulfilment fees, our tool ensures accuracy and saves you time, allowing you to get the important information quickly and efficiently.

Our ROAS calculator is designed to be user-friendly and provide actionable insights. Simply input your ad spend, revenue data, and other e-commerce costs, and it will calculate your ROAS, giving you a clear picture of your advertising effectiveness.

Take the first step towards more efficient adverting investments by trying out our new ROAS calculator today.