What’s ROAS? – Tips for Increasing Your Paid Search

Have you invested in paid search campaigns?

If yes, you have numerous paid search metrics to focus on. But, there is one metric that stands above the rest, and that would be “Return On Ad Spend” (ROAS).

A major role for online advertisements would be the ability to drive more sales into your business. If you are investing in paid searches, you are bound to wish for more sales and site visits. Paid search campaigns are carefully planned to target the right customers. It is important for you to identify potential customers who always drop down in the funnel. When compared to paid social clicks and simple displays – Paid Search Clicks prove to be more expensive. However, the extra bucks you spend are always worth it when a customer clicks on the link.


You must not assume that paid search campaigns are always successful and worthy because you have focused on elements low in the funnel. This is when ROAS becomes useful.

What is Your ROAS?

In order to improve your paid search strategies, you need to figure out what ROAS is. Once you figure this out, you will be able to boost sales and track conversions easily. To make the most of ROAS, you should be aware of the ads, ad groups and campaigns that can result in sales and conversions.


Fortunately, it is pretty easy to track sales and conversions in modern paid search platforms. For instance, if you have launched an E-Commerce Company, you can connect transactions with conversion value and view the performance of each campaign using AdWords.

Remember, ROAS is much more than a simple metric for measuring your E-Commerce Business.

Read More: Top 4 Tips for Increasing Your Organic Reach on Search

How to Use ROAS Data?

In this modern era, many marketers don’t realize the benefit of ROAS data. In fact, a majority of the marketing decisions are not made using this data. Using conversion data and metrics like click data can guide your marketing efforts. But, without utilizing ROAS data, you might end up with the wrong decisions. This will hurt your company and its profit.

Making Use of ROAS

Let’s understand this with an example: Imagine you have a dolphin-watching business. You charge 150 USD for an hour of fun! You make around 20 reservations every month and see a profit of 50% of the margin. You rely on paid search campaigns for more business.

If you charge 150 USD for a ticket, and if the cost for new reservations is 150 USD, you will be left in a deep hole with each purchase. Top 4 Tips for Increasing Your Organic Reach on Search


If you choose to increase your ticket to 300 USD to operate at 2x ROAS and spend 75 USD on marketing, you will still not be able to pay off.

Now, trying to operate at 3x ROAS will make lots of sense. This is when you will actually see some money. If 20 more reservations can be made with 3x ROAS, you are more likely to see some rolling cash in the business.


Avatar of Rohit Mehta

I am an Indian blogger, journalist, author and entrepreneur. I am working in digital marketing and IT sector for more than 10 years.

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