ROAS (Return on Ad Spend)
How much revenue you earn for every Ringgit spent on advertising. A ROAS of 3× means every RM1 spent returns RM3 in sales. Most Malaysian SMEs target 2–4× ROAS.
What is ROAS?
ROAS (Return on Ad Spend) measures how much revenue your business earns for every Ringgit spent on advertising. It's the primary metric for evaluating whether your ad campaigns are profitable.
Formula: ROAS = Revenue from Ads ÷ Ad Spend
Example: If you spend RM1,000 on Facebook Ads and generate RM4,000 in sales, your ROAS is 4× (or 400%).
What's a Good ROAS in Malaysia?
Target ROAS varies by business type and margins:
- E-commerce (Shopee/Lazada): 3–5× is considered healthy
- F&B / Services: 2–3× is acceptable due to higher margins
- High-ticket items (property, luxury): Even 1.5× can be profitable
ROAS vs ROI
ROAS only measures revenue against ad spend. ROI accounts for all costs including product cost, fulfilment, and overheads. A campaign with 4× ROAS might still be unprofitable if your product margin is thin. Always calculate both.
How to Improve ROAS
- Tighten audience targeting — stop showing ads to people unlikely to buy
- Test ad creative — better visuals and copy increase CTR and conversions
- Improve landing page — faster load, clearer offer, mobile-optimised
- Use retargeting — warm audiences convert at 3–5× the rate of cold audiences
Apply this with MarketOS
AI content, ads, SEO, CRM — built for Malaysian SMEs.