What is ROAS (Return on Ad Spend)?
ROAS is the revenue generated for every dollar spent on advertising or influencer marketing, calculated by dividing total revenue attributed to the campaign by total spend.
A ROAS of 3x means the brand earned $3 for every $1 spent. Brands use ROAS as the primary metric to compare influencer campaigns against paid social, search, or other channels. It normalises performance across different budget sizes.
Measuring ROAS from influencer content requires reliable attribution, typically via unique discount codes, affiliate links, or UTM-tagged URLs. Without tracking, brands can only estimate revenue impact, which undermines decision-making.
ROAS thresholds vary by category. A DTC brand with high margins might consider 2x ROAS profitable; a low-margin product might need 6x or more. Brands should define their target ROAS before setting campaign budgets.