What the ROAS? A practical guide to improving return on ad spend
Contributor Jacob Baadsgaard shows how ROAS, or return on ad spend, can be used to show the effectiveness of advertising campaigns and whether they are worth the money spent on them.
Do you want to improve your paid search campaigns? There are a lot of paid search metrics, but one of the most useful and most underused is return on ad spend (ROAS).
One of the main points behind online advertising is to drive sales for your business. This is particularly true when it comes to paid search. Most paid search campaigns are targeting potential customers who are fairly low in the funnel. A paid search click usually costs more than a display or paid social click, but it’s worth having if that click turns into a paying customer.
However, just because you are targeting bottom-of-the-funnel traffic, that doesn’t mean that every element of your paid search campaigns is a good investment.
This is where ROAS comes into play. One of the best things about paid search advertising is the ability to connect what you spend on a campaign, ad or keyword to how much new revenue is generated. With a little extra effort, you can connect all the dots and use ROAS to identify which aspect of your paid search advertising deserves more of your budget and which needs work.