This is the moment every business owner in Egypt faces at some point. ROAS looks good on paper, but cash flow feels tight.
The truth is, many people don’t really understand what ROAS is or how to measure it in a way that actually shows profit.
And when you don’t measure it properly, you risk making decisions that can drain your budget without you even noticing.
So let’s strip away the jargon and talk about what ROAS really means, how to measure it, and how to know if your social media ads and Google Ads are truly profitable.
What Exactly Is ROAS
ROAS stands for Return on Ad Spend.
It’s the most common way to measure if your ads are working.
The basic formula is simple:
Revenue from Ads ÷ Ad Spend
Example: If you spent 10,000 EGP on ads and got 40,000 EGP in sales, your ROAS is 4.
That means for every 1 EGP you spent, you made 4 EGP back.
What Is a Good ROAS for My Business
There’s no universal “good ROAS.” It depends on your industry, profit margins, and growth goals.
High-margin businesses (like digital products) can be profitable even with a lower ROAS.
Low-margin businesses (like retail or food delivery) often need a higher ROAS just to break even.
Service businesses may fall somewhere in between.
As a rule of thumb, if your ads are covering costs and leaving enough profit to reinvest and grow, your ROAS is working for you.
Why Chasing High ROAS Can Be a Trap
Here’s the controversial part: a high ROAS doesn’t always mean healthy growth.
For example, a campaign retargeting old customers might show a “10x ROAS,” but that doesn’t grow your business.
It just squeezes more sales out of the same small audience.
On the other hand, a “2x ROAS” campaign that brings in new customers might be far more valuable in the long run, because those new buyers can come back and buy again.
ROAS vs ROI What’s the Difference
A common mistake is confusing ROAS with ROI (Return on Investment).
ROAS = Revenue from ads ÷ Ad spend
ROI = Profit ÷ Total investment (including product costs, staff, delivery, and overhead)
ROAS tells you if your ads generate sales, ROI tells you if your business is actually profitable.
Closing Thought
If you’re only looking at ROAS as “money in versus money out,” you’re not getting the full picture.
The real question is: Are my ads making me profit after all costs?
When you measure ROAS with that in mind, you’ll stop chasing pretty numbers in a dashboard and start running campaigns that actually grow your business.
Your ads shouldn’t just look good on reports they should feel good in your bank account.
FAQs
What is ROAS in simple terms?
ROAS means Return on Ad Spend. It tells you how much revenue you made for every pound or dollar spent on ads.
How do I calculate ROAS manually?
Take your total revenue from ads and divide it by your total ad spend for the same period.
What happens if my ROAS is less than 1?
It means you’re losing money, you spent more on ads than you earned back in sales.
What is considered a good ROAS?
It depends on your industry and margins. A good ROAS is one where your ads cover all costs and still leave you with profit.
Should I only focus on ROAS when measuring ads?
No. You should also track profit margins, customer lifetime value, and acquisition costs for a full picture.
