ROAS

ROAS ( Return on ad spend ) is a measure of the return on investment for an advertising campaign.

If several campaigns were launched at once, then using ROAS you can calculate which one brings more profit. So in the future, you can abandon unprofitable channels, and redirect the saved money to those that make a profit.

Since after the launch of an advertising company, its effectiveness is necessarily evaluated according to various parameters: the number of targeted actions on the site, clicks on an advertisement, and the growth in the number of subscribers. But, it is difficult to estimate profit by these indicators. To understand how much profit advertising brought, you need to calculate ROAS.

If you do not calculate ROAS, then you can evaluate the effectiveness of advertising campaigns only by reaching the audience and the number of clicks. But neither one nor the other indicator will show the result of sales, as people may click on an advertisement by mistake or simply out of interest, and not with the goal of buying something. It is the ROAS indicator that will help assess whether an advertising campaign has paid off or not, since it is directly related to costs and profits.

As we said above, when launching advertising in different social networks, the calculation of the ROAS indicator will allow you to understand in which of them the advertising campaign brings more profit at the same costs. As a result, marketers will be able to stop an unprofitable advertising campaign, thereby saving the budget or, having studied the statistics, identify errors and restart it after making changes.

Why is ROAS difficult to calculate in b2b?

B2b involves a long buying process. For example, a client was brought to the site by online advertising, but in order to complete a deal, the buyer will come to the seller’s office. For example, developers who need various building materials. The volume of the purchase is large, even if they see the supplier's advertisement on the Internet, they will still draw it up in the office, and not on the website. As a result, only the manager will have information about the profit, and most likely it will not reach the marketer. It turns out that the advertisement worked, attracted a client, but information about the profit from the advertisement will not be included in the report. In order not to miss a single amount, you need to set up end-to-end analytics. With its help, data from CRM will be transferred to all necessary reports for both marketers and sales managers.

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