The difference between ROAS and true marketing ROI
Return on Ad Spend (ROAS) and Return on Investment (ROI) are often used interchangeably, but they measure different things. ROAS is an efficiency metric that compares revenue directly to ad spend, ignoring all other costs. ROI is a profitability metric that measures net profit relative to all campaign expenses.
A campaign with a 400% ROAS can have a negative ROI if the cost of goods sold, shipping, and agency fees exceed the remaining revenue. For a complete look at ecommerce profitability, use the ROAS to ROI calculator, or audit blended channels using the blended marketing ROI (ROMI) calculator.