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ROAS - Instagram Glossary

ROAS is revenue generated divided by advertising spend. A ROAS of 4 means four units of revenue per unit spent. It measures advertising efficiency and, on its own, says nothing about whether the business made any money.

The number people should be looking at is ROAS relative to margin. A ROAS of 3 is excellent on a digital product with 95% margin and loss-making on a physical product with 30% margin and shipping. Reporting ROAS without margin context is how campaigns get scaled into losses.

Attribution is the second trap. Platform-reported ROAS credits conversions the platform can see, which after recent privacy changes systematically over-credits some paths and misses others entirely. Comparing platform-reported ROAS against actual bank deposits over the same period is the only reliable sanity check.

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