ROAS tells you how much revenue your ads bring in. POAS tells you how much profit — and the two often tell opposite stories.
ROAS (Return on Ad Spend) divides revenue by spend — and stops there. It knows nothing about what the goods, shipping or returns cost you. Two campaigns with the same 5x ROAS can be one excellent and one disastrous, depending on the margin of the products sold.
| Scenario | Margin | Gross profit | POAS | Verdict |
|---|---|---|---|---|
| Electronics accessories | 12% | RON 600 | 0.60x | you lose RON 400 |
| Private-label fashion | 55% | RON 2,750 | 2.75x | +RON 1,750 profit |
The platform shows "5x ROAS — good performance" for both. Only POAS tells you the first scenario digs you deeper with every unit of currency you scale.
In the POAS formula, "margin" is the percentage of the selling price that remains as profit — not the markup applied to the purchase cost. It is the most common mistake: you buy at RON 50, sell at RON 100 → 100% markup, but 50% margin. Feed the markup into the calculation and your POAS comes out double what it really is.
| Markup (on cost) | Actual margin (on price) |
|---|---|
| 30% | 23% |
| 50% | 33% |
| 100% | 50% |
| 150% | 60% |
The rule is simple: break-even ROAS = 1 ÷ margin. Below it, every conversion costs you money:
| Your average margin | Minimum ROAS (break-even) | "Comfortable" ROAS (POAS ≥ 1.3) |
|---|---|---|
| 15% | 6.7x | 8.7x |
| 25% | 4.0x | 5.2x |
| 35% | 2.9x | 3.7x |
| 50% | 2.0x | 2.6x |
That is why a "standard" 4x target ROAS means profit for one store and a haemorrhage for another. The right target depends on your margin — and, ideally, on the margin of each product.
Take the ROAS from your account and your real average margin (after cost of goods):
Careful: margin as a % of the selling price, not markup on cost. 100% markup = 50% margin. Conversion: margin = markup ÷ (1 + markup).
The calculator gives you the account-level picture. seenly.ad calculates it for every product, automatically, every day →
| ROAS | POAS | |
|---|---|---|
| What it measures | Revenue per unit of ad spend | Profit per unit of ad spend |
| Accounts for margin | No | Yes — including COGS, shipping, fees |
| The "good" threshold | Depends on margin (ROAS alone won't tell you) | Universal: above 1 = profit |
| Can be fooled by attribution | Yes, easily | Harder — especially reconciled with GA4 |
| Comparing products with different margins | Misleading | Accurate |
| What it remains good for | The operational lever (tROAS in the platform) | The decision compass: budget, scaling, exclusions |
COGS per product (or at least per category), average shipping, payment fees, the cost of returns. Without margins, POAS is guesswork.
1 ÷ margin. Any campaign below it loses money no matter how good it looks in the platform.
HERO (high POAS), healthy, borderline, TOXIC. The account average hides the extremes — the money is decided at product level.
Bid more aggressively on HERO, exclude TOXIC, set different tROAS for segments with different margins — not a single target across the whole account.
Done manually, this takes hours every week. seenly.ad calculates POAS for every SKU and labels the feed automatically, every night.
Profit on Ad Spend — gross profit ÷ spend. Above 1 = your ads make money.
Return on Ad Spend — revenue ÷ spend. Ignores costs entirely.
Cost of Goods Sold — what the goods you sell cost you (purchase/production).
1 ÷ margin. The minimum ROAS at which you don't lose money.
Total revenue ÷ total marketing spend. Cannot be fooled by attribution.
Target ROAS — the target you give the platform's bidding algorithm.
The account average hides the extremes: a few HERO products carry the profit while others quietly burn it. seenly.ad calculates POAS for every SKU — joining spend from Ads, revenue from GA4 and the product's margin (real cost from the feed, category margin or a per-store fallback) — then labels the feed automatically so you can bid differently on each segment.
And in the multi-channel report, POAS sits next to true ROAS, MER and the marketing P&L — so you make decisions on money, not vanity metrics.
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