Sazaro / UNIT ECONOMICS
ROAS is not profit: which metrics should you track?
ROAS compares attributed revenue with ad spend. Profitability also depends on margins, returns, new customers, and operating costs.
ROAS and its limits
If a campaign attributes €1,000 in revenue to €250 in spend, its ROAS is 4. This illustrates the calculation; it is not a Sazaro result. It does not show product costs, returned orders, or costs omitted by attribution.
Break-even depends on costs
At a 40% contribution margin before advertising, simplified break-even ROAS is 2.5. The margin must include the agreed variable costs. Fixed costs and a profit target require additional headroom. Use a consistent tax basis rather than mixing VAT-inclusive revenue with VAT-exclusive costs.
CAC, MER, and LTV
CAC compares acquisition costs with new customers; record which costs are included. MER compares total revenue with ad spend, but does not prove advertising's effect. Estimate LTV by cohort and period. Contribution after costs, rather than revenue alone, helps set an affordable CAC.
Turn a number into a decision
Compare consistent periods, returns, and new customers. Do not add together revenue attributed by different platforms. Reference: GA4 attribution.
The next step
To see how we plan and deliver new ads every week, read about our creative packages.