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    Glossary

    ROAS (Return on Ad Spend)

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    Definition

    ROAS, or Return on Ad Spend, is a marketing metric that measures the revenue generated for every dollar spent on advertising. A 4x ROAS means $4 in revenue for every $1 in ad spend. It's calculated by dividing total ad-driven revenue by total ad spend, giving businesses a direct measure of campaign profitability.

    Why it matters for Detroit businesses

    Detroit business owners don't need more impressions — they need to know if their ad budget is making money. House of Karma tracks ROAS on every Meta and Google campaign we manage, connecting ad spend directly to CRM-tracked revenue so you see exactly which campaigns are profitable and which are draining your budget.

    Frequently Asked Questions

    What is a good ROAS?

    A good ROAS depends on your profit margins and business model. Most businesses need a 3x to 4x ROAS to be profitable after accounting for product costs and overhead. House of Karma's managed campaigns average a 4.8x ROAS in the first 60 days, but the right benchmark depends on your specific margins.

    How is ROAS different from ROI?

    ROAS measures revenue generated per dollar of ad spend — it looks only at ad costs versus ad-driven revenue. ROI (Return on Investment) is broader, factoring in all costs — product, overhead, labor — to determine overall profitability. ROAS is a marketing-specific metric; ROI is a business-level metric.

    Related terms

    CAC (Customer Acquisition Cost)Conversion RateRetargeting

    Put this to work for your business.

    Understanding the terminology is step one. Let's build the systems behind it.

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