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Introduction of ROAS: How it makes sense for Amazon Advertising

While we’ve been loyal to our ACoS (Advertising Cost on Sales) companion, there’s been a quiet revolution happening in the world of Amazon Advertising. Brands and strategists have started throwing around the term “ROAS” like confetti.

Well, hold on tight, because there’s a new superhero– ROAS, and it’s ready to take your Amazon Advertising game to the next level. If now you’re wondering how it can make your Amazon Advertising efforts more efficient and powerful, buckle up. We are going on the Amazon jungle journey yet again.

What superhero is this?

Think of it as a magic mirror that shows you how effectively your advertising dollars are working for you. If you want to gauge the efficiency of your marketing campaigns effortlessly, Return on ad is your go-to metric.
ROAS is essentially the inverse of ACoS. While ACoS tells you how much you spend on advertising for every dollar in sales, ROAS google ads flips the script. It reveals how much revenue you generate for every dollar spent on advertising. In other words, ROAS = Sales / Ad Spend.

While ACoS is represented as a percentage, Return on ad spend is measured as an index multiplier. So, when you see that the mark is of 5, it means you’re earning five times your ad spend in revenue. It’s all the talk about getting your money’s worth!

There’s a huge confusion in the market, that is people often use ROAS and ROI (Return on Investment) interchangeably.To mention, ROI is all about net profit against your investment. It’s the big picture that takes into account all your costs, not just ad spend.

What to do with your ROAS metric?

With return on advertising, you can compare different campaigns, learn from the high-performing ones, and fine-tune your strategies where needed.. Amazon Advertising is a platform where sellers and advertisers canalways their campaign performance. Stated along ROAS is not the sole measure of your advertising success. You’ve got to consider other factors too, like your campaign objectives, the duration of performance, and metrics that indicate different stages of the sales funnel. 

You can find Return on ad spend, in the Campaign Manager and through downloadable reports, making it accessible for everyone in the Amazon Advertising game.

What’s else it holds for the Amazon advertisers? 

Now, something that’s even more exciting is that return on advertising has officially strolled into Amazon Marketing Services, waving its banner of efficiency and precision. Whether you’re a seller or a vendor, you can find the ad return in the Campaign Manager and through downloadable reports. It’s like a shiny new tool in your toolbox.

ROAS, or Return on Ad Spend, is more than just a buzzword; it’s a valuable compass guiding your advertising campaigns towards success. While ACoS has served us well, ROAS brings a fresh perspective, allowing us to measure the efficiency of our marketing efforts in a new light.

So, dear Amazon advertisers, it’s time to embrace this revolution. Keep ACoS as your trusty sidekick, but let it be your superhero guide in the complex world of Amazon Advertising.  In conclusion, ROAS is a valuable addition to the Amazon Advertising toolkit. It’s a straightforward way to gauge your campaign efficiency and make data-driven decisions. So, as you embark on your Amazon Advertising adventures, keeping an eye on it, might just lead you to the pot of gold. Quite literally.

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