Advertising

Break-even ROAS for Ecommerce

Break-even ROAS estimates the advertising efficiency at which the modeled contribution after advertising reaches zero.

Break-even ROAS estimates the advertising efficiency at which the modeled contribution after advertising reaches zero. It is a boundary, not a target.

Why it matters

A store can report strong revenue while losing money if advertising consumes the contribution available after product, fulfillment and marketplace costs.

Break-even ROAS ≈ Revenue ÷ Maximum Affordable Ad Cost

Do not scale at the boundary

A business normally needs a safety margin above break-even to absorb refunds, volatility, overhead and measurement error. The correct target depends on your economics and business objectives.

Use the numbers

Educational guidance is most useful when paired with your own SKU economics. Run the same assumptions through the calculator, then compare marketplaces if channel selection is part of the decision.

Open Profit Calculator Compare Marketplaces