Marketing ROI Calculator: ROI, ROAS & Break-even ROAS

What this ROI calculator does

“We got 4x ROAS” sounds great, but it does not tell you whether the campaign made money. This ROI calculator connects your ad numbers to your profit. Enter ad spend, other campaign costs, revenue (or orders and average order value) and your gross margin. It shows:

• ROI: net profit from the campaign as a percentage of everything you spent on it.
• ROAS: revenue for every rupee of ad spend.
• Break-even ROAS: the ROAS you need just to cover costs at your margin.
• Profit and cost per order.

A comparison table below lets you put up to three campaigns, channels or months side by side and see which one actually earns the most.

ROI vs ROAS: why you need both

ROAS only looks at revenue and ad spend. It ignores what the product costs you, shipping, fees and the other costs of running the campaign. ROI uses profit, so it answers the real question: did this spend make us money?

The link between them is your gross margin. If you keep 40% of revenue after product cost, shipping and fees, you need at least ₹2.50 of revenue for every ₹1 of ad spend (1 ÷ 0.40) just to break even on ads alone. Add creative and tool costs and the break-even ROAS goes higher. A campaign at 2x ROAS with a 40% margin is losing money, however good the revenue looks.

How to use the calculator

1. Enter ad spend for the period: Google Ads, Meta, Amazon or Flipkart Ads, or any other paid channel.
2. Enter other campaign costs, such as creatives, influencer fees, landing page tools, or the cost of discounts you funded.
3. Choose how to enter revenue. Use orders × average order value if you track orders, or type total revenue.
4. Enter your gross margin. This is the share of revenue left after product cost, shipping, packaging and marketplace or payment fees.
5. Read ROI, ROAS and break-even ROAS. If ROAS is below break-even, the campaign is losing money at this margin.
6. Compare campaigns in the table below by entering spend, revenue, orders and margin for each.

The formulas

• Revenue = orders × average order value (or the revenue you enter)
• Gross profit = revenue × gross margin %
• Net profit = gross profit − ad spend − other costs
• ROI % = net profit ÷ (ad spend + other costs) × 100
• ROAS = revenue ÷ ad spend
• Break-even ROAS = (ad spend + other costs) ÷ (ad spend × gross margin)
• Cost per order = (ad spend + other costs) ÷ orders

Worked examples

A D2C skincare brand on Meta ads

The brand spends ₹50,000 on ads and ₹10,000 on creatives in a month, and gets 200 orders at an average of ₹1,200. Revenue is ₹2,40,000. With a 40% gross margin, gross profit is ₹96,000. Net profit is ₹36,000, so ROI is 60%. ROAS is 4.8x against a break-even ROAS of 3x. This campaign is healthy.

A marketplace seller running Sponsored Products

A home-goods seller spends ₹20,000 on Amazon ads and records ₹70,000 in ad-attributed sales. ROAS is 3.5x, which looks fine. But after Amazon fees, shipping and product cost, the seller keeps only 25% of revenue. Gross profit is ₹17,500, which is less than the ad spend, so ROI is −12.5%. Break-even ROAS at a 25% margin is 4x. The fix may be better listings, tighter keywords or a higher price, not more budget.

Google Search vs Meta for an international SME

A small exporter compares two channels in the comparison table. Google Search brings ₹1,80,000 from ₹45,000 in total cost, and Meta brings ₹1,30,000 from the same cost, both at a 40% margin. Google Search returns 60% ROI; Meta returns about 16%. Both are profitable, but the next rupee of budget has a clear home.

Tips and common mistakes

• Using gross revenue. Remove GST, returns, cancellations and RTO orders before you enter revenue, or your ROI will look better than it is.
• Leaving out other costs. Creative production, tools and management time are part of the campaign’s cost.
• Judging only on ROAS. Always compare ROAS with your break-even ROAS.
• Ignoring repeat purchases. If first orders lead to repeat buyers, one campaign’s ROI understates its value. Track customer lifetime value separately.
• Comparing different time windows. Use the same period and attribution window for every campaign in the table.

FAQs

What is a good ROAS?

There is no single good number. A good ROAS is one above your break-even ROAS, which depends on your margin. At a 50% margin, anything above 2x covers ad spend; at a 20% margin you need more than 5x.

What is the difference between ROI and ROAS?

ROAS is revenue divided by ad spend. ROI is net profit divided by total campaign cost. ROAS shows how well ads generate sales; ROI shows whether those sales made money.

How do I find my gross margin?

Take your average selling price without GST, subtract product cost, packaging, shipping and marketplace or payment fees, then divide by the selling price. Our profit margin calculator can help.

Can ROI be negative while ROAS is above 1?

Yes. A ROAS of 2x means ₹2 of revenue per ₹1 of ads, but if you keep only 30% of revenue as gross profit, you earn ₹0.60 for every ₹1 spent and lose money.

Can I use this for SEO or content marketing?

Yes. Put your monthly SEO or content cost in “other costs”, leave ad spend at zero, and enter the revenue from organic traffic. ROI will work; ROAS and break-even ROAS need ad spend, so they show a dash.

Grow returns that do not stop when the ads do

Paid campaigns stop earning the day you pause them. Organic search keeps bringing buyers at no cost per click, which lifts your blended ROI over time. See our SEO services to build that channel, and browse all GrowthLife free tools, including our profit margin and marketplace fee calculators.