Calculator · Ads
ROAS calculator: calculate break-even ROAS and ACoS for OTTO
Up to what ACoS do you still make money on an item? And what ACoS can you afford if you want a margin left after ads?
| Profit before ads per sale | 12.01 € |
| Break-even ACoS | 30% |
| Break-even ROAS | 3.33 |
| Target ACoS at 15% margin | 15% |
ACoS means ad spend divided by revenue from ads, and ROAS is the inverse. If a campaign is above the break-even ACoS, every sale from ads costs you money.
MargenOptimierer measures every campaign against your target ACoS and lowers bids that are too expensive with one click. MargenOptimierer costs from 49 € net per month. You can test the first 14 days for free, no credit card needed.
Calculating ROAS and ACoS: the formulas
ACoS is your ad spend as a share of the revenue the ads brought in. ROAS is the same thing the other way round, meaning revenue per euro of ad spend.
ACoS=ad spend÷ad revenue
ROAS=ad revenue÷ad spend=1÷ACoS
You calculate the break-even ACoS from what a sale brings in before ads. At this ACoS, ads eat up exactly the profit. If you want a margin left after that, subtract it and you get your target ACoS.
Break-even ACoS=profit before ads÷selling price
Target ACoS=break-even ACoS−desired margin
Calculate all three numbers as a percentage of the selling price including VAT. A margin on the price excluding VAT is 1.19 times larger at 19% VAT and doesn't match the ACoS.
Example: target ACoS for an item at 39.99 €
Say an item costs 39.99 € including VAT, and you want 15% margin left after ads.
| Selling price including VAT | 39.99 € |
| VAT | −6.38 € |
| Commission (15%) | −6.00 € |
| Purchase price | −9.50 € |
| Shipping | −4.90 € |
| Return costs per sale | −1.20 € |
| Profit before ads | 12.01 € |
Break-even ACoS=12.01 €÷39.99 €=30%
Target ACoS=30%−15%=15%
Target ROAS=1÷15%=6.65
How OTTO calculates ACoS
OTTO counts the price your customer pays, including VAT, as ad revenue. That's why this calculator works out ACoS on the selling price including VAT, exactly like OTTO's ad console. Purchases up to 14 days after a click on an ad count as ad revenue.
Read more
- What is a good ACoS on OTTO, and how do I calculate it?
- Which metrics matter for OTTO ads?
- When do I lower and when do I raise bids on OTTO?
- Calculate profit and contribution margin per item on OTTO
- Calculate retail margin: calculator with formula and markup
- Calculate return costs: what a return costs you on OTTO