# ROAS. Return on ad spend

> Return on ad spend: revenue attributed to an advertising campaign divided by the cost of that campaign, usually reported by the platform that sold the advertising and usually on revenue the platform has attributed to itself.

Source: https://barkingcat.ai/terms-of-trade/roas/

## Terms of Trade · Edition 1: The PE deck

Definition

Return on ad spend: revenue attributed to an advertising campaign divided by the cost of that campaign, usually reported by the platform that sold the advertising and usually on revenue the platform has attributed to itself.

Field note

ROAS is the number an agency hides behind when your channel is loss making. It sounds like a business until the product margin, the returns and the fulfilment cost come off the numerator and the platform’s share of the revenue turns out to have been counted twice, once by Google and once by Meta.

Board question

What is the contribution margin on this channel after the ad spend, and does finance recognise the revenue the platform is claiming?

Applied through

[Commercial Discipline](https://barkingcat.ai/the-cats-whiskers/commercial-discipline/) in the Cat’s Whiskers, money in the right places for the right reasons.

Related terms
- [CAC](https://barkingcat.ai/terms-of-trade/cac/)
- [Attribution](https://barkingcat.ai/terms-of-trade/attribution/)
- [Incrementality](https://barkingcat.ai/terms-of-trade/incrementality/)
- [Contribution margin](https://barkingcat.ai/terms-of-trade/contribution-margin/)

## Contact

steve@barkingcat.ai

Barking Cat Advisory Limited. Registered in England and Wales, company number 17338003.