v0.10.0How to use
- Enter the ad spend and the revenue driven by that advertising (ad-driven revenue). Use the conversion revenue from your ad platform report or your own figures as they are. This tool does not estimate performance; it only calculates what you enter.
- Enter the cost ratios relative to revenue: the cost ratio (product cost ÷ revenue) and the fee and other cost ratio (marketplace fees, payment fees, shipping and so on ÷ revenue). Their sum is used for the ad profit.
- Enter a target ROAS or a target ad profit to get the revenue needed to reach it.
- The key results at the top (ROAS, ad profit, contribution margin, ROI, break-even ROAS) and the detailed results update as you type. [Copy results] copies the detailed results table as text.
Example
With ad spend of 1,000,000, ad-driven revenue of 4,000,000, a cost ratio of 50% and a fee and other cost ratio of 10%, ROAS is 400%. Costs are 4,000,000 × 60% = 2,400,000, the contribution margin is 1,600,000, the ad profit after ad spend is 600,000 and ROI is 60%. Break-even ROAS is 100% ÷ 40% = 250% (revenue of 2,500,000), so the current ROAS of 400% is above break-even. A target ROAS of 500% needs revenue of 5,000,000, and a target ad profit of 1,000,000 needs (1,000,000 + 1,000,000) ÷ 40% = 5,000,000.
How it is calculated
| Item | Calculation |
|---|---|
| ROAS | Ad-driven revenue ÷ ad spend |
| Costs | Revenue × (cost ratio + fee and other cost ratio) (rounded up to the won) |
| Contribution margin | Revenue − costs |
| Ad profit | Contribution margin − ad spend (before tax) |
| ROI | Ad profit ÷ ad spend |
| Break-even ROAS | 100% ÷ (100% − total cost ratio) |
| Break-even revenue | Ad spend ÷ (100% − total cost ratio) (rounded up to the won) |
| Revenue needed for the target ROAS | Ad spend × target ROAS (rounded up to the won) |
| Revenue needed for the target profit | (Ad spend + target profit) ÷ (100% − total cost ratio) (rounded up to the won) |
Attribution rules on ad platforms and marketplace fees change often, so check each platform's latest guidance before deciding.
Supported formats, limits and privacy
- Input: whole amounts of 0 or more (in KRW, commas allowed, up to 999,999,999,999), cost and fee ratios from 0 to 100%, and a target ROAS of 0 or more (up to two decimal places and seven digits before the point).
- ROAS (revenue per ad spend) = ad-driven revenue ÷ ad spend, and ROI (profit per ad spend) = ad profit ÷ ad spend. A high ROAS can still be a loss after product cost and fees, so look at the ad profit and break-even ROAS together. If ad spend is 0, ROAS and ROI are shown as not available.
- Costs = revenue × (cost ratio + fee and other cost ratio), with fractions of a won rounded up once, so costs are never understated. Contribution margin = revenue − costs (before ad spend). Ad profit = contribution margin − ad spend (before tax). If the cost ratios add up to 100% or more, more revenue never leaves a profit, so break-even ROAS and the target-profit revenue are shown as none.
- Break-even ROAS = 100% ÷ (100% − total cost ratio): at this ROAS the contribution margin equals the ad spend (rounded half up to 0.01%). Revenue needed for the target ROAS = ad spend × target ROAS, and revenue needed for the target profit = (ad spend + target profit) ÷ (100% − total cost ratio), both rounded up to the won. Because costs are rounded up, the break-even revenue and the target-profit revenue are exactly the lowest whole-won revenue at which the ad profit shown meets the condition (rounding costs half up would, with tiny amounts, show an ad profit of 0 yet say break-even was not reached). ROAS and break-even ROAS are shown to 0.01%, so near break-even they can look identical; the profit-or-loss judgment always follows the actual ad profit. All arithmetic uses integers, so there are no floating-point errors.
- This is a simple calculator that works only from the values you enter. How ad-driven revenue is attributed (window, model) differs between platforms, and returns and refunds, organic revenue outside the ads and taxes such as VAT are not included. Do not use it for tax or accounting decisions.
- What you enter is calculated only inside this browser. It is not sent to a server or stored, and it disappears when you close the page.
Frequently asked questions
What is the difference between ROAS and ROI?
ROAS is revenue per ad spend and ROI is profit per ad spend. If 1,000,000 of ad spend brings 4,000,000 of revenue, ROAS is 400%, but if cost and fees take 60% of revenue (2,400,000), the contribution margin is 1,600,000 and the ad profit after ad spend is 600,000, so ROI is 60%. To judge by profit rather than revenue, look at ROI and the ad profit.
What is break-even ROAS?
The ROAS at which the ad profit is exactly 0. If the cost ratios add up to 60%, only 40% of revenue is left, so recovering the ad spend takes 2.5 times the ad spend in revenue (ROAS 250%). Above that the ads make a profit; below it they make a loss.
What goes into the cost ratios?
Put the share of revenue taken by the product cost (purchase price) in the cost ratio, and the share taken by the other costs that scale with revenue, such as marketplace fees, payment fees, packaging and shipping, in the fee and other cost ratio. Fixed costs such as rent are not part of the profitability of one campaign, so leave them out.