ROAS
Also called Return on ad spend.
Conversion value divided by what the ads cost. Five thousand in value from one thousand spent is a ROAS of 5, often shown as 500%.
Why it matters
It is only as true as the values behind it. With a flat value on every lead, ROAS is just lead count times a constant; with values from your own closed deals, it starts to mean something.
What goes wrong
In lead gen the value reported on the day a lead arrives is an estimate of what it will bring, not money in the bank. A ROAS read from those values says what the campaign is expected to return, and the check is whether closed deals later confirm it.
It also depends on what the value counts. Revenue, profit and lifetime value give very different ROAS for the same campaign, and a target has to be read in the same terms as the values.
How to check it on your own account
Take last quarter's campaigns and divide the revenue from deals that actually closed by what you spent. Set it next to the ROAS your ads report shows.
Next to this
Where this comes up
- Value-Based Bidding for Lead Generation - The Complete GuideA lower cost per lead looks good in a report. It means much less if those leads never become customers. How to estimate what a lead is worth, send it to Google Ads, and check whether the bids brought better business.
- Meta Value Optimization for Lead Generation - The Complete GuideHow to give Meta a value for every lead, which of its three optimization goals your account can actually use, why the value has to arrive once and on day zero, and how to tell whether Meta is now finding better customers or just more leads.
- Google Ads Value-Based Bidding Migration Guide: What to Expect When You SwitchA staged migration, in Google's own order. What resets the learning period, why it is measured in conversions and not days, and when you can honestly read the result.
- Journey-Aware Bidding: Google's Lead-Gen Bidding Upgrade, and What It Does Not DoJourney-aware bidding is an upgrade to Smart Bidding, not a new strategy. Target CPA campaigns learn from every stage between a form fill and a sale. What changes for lead-gen advertisers, what does not, and what to prepare.
- The Future of Lead-Gen Bidding Is Better Value SignalsWhy the next improvement may come from what you tell the algorithm, not from a more complicated prediction model. Ranking is not enough, magnitudes matter, and delivery is part of the model's practical value.
How it applies in your trade
The same method, worked through for each kind of business: what a lead is worth, what is known on arrival and what to prepare.
The rest of this step
- Value-based bidding
- Maximize conversions
- Target CPA
- Smart Bidding
- Maximize conversion value
- Target ROAS
- Learning period
- Conversion volume threshold
- Portfolio bid strategy
- Journey-aware bidding
- Lead Intent Scoring
- Data-driven attribution
- Value optimisation
- Advantage+
- Value-Based Optimization
- Smart+
- Performance Max
- AI Max
- Aggregated Event Measurement
Measure this on your own data
The diagnostic reads a CRM export in your browser and reports your volume, your match rate and the spread between your leads against the thresholds in this glossary. Nothing is uploaded and no account is needed.