Tools / Economics of Advertising
Profitability thresholds for acquisition decisions.
Consider break-even ROAS, target CPA, profitability thresholds and scaling economics.
Work area
ROAS Calculator
Live
Economics
4
Inputs
Instant
Signals
2.38x
Break-even ROAS
$57
Target CPA
$59524
Revenue needed
441
Estimated orders
Profitability indicator
With such a margin, the account needs approximately 15747 high-quality clicks for a given conversion in order to gain volume for deciding on scale.
Work process
Set limit
Start with margin and average ticket so that acquisition targets reflect the real economics of the business.
Calculate thresholds
Convert revenue and margin into break-even ROAS, target CPA and allowable spend.
Scale with guardrails
Use thresholds to understand when to increase your budget, hold back spend, or rebuild your funnel.
FAQ
What is break-even ROAS?
This is the ROAS that is needed to cover the product margin before the acquisition becomes profitable.
Does this replace the financial model?
No. This is a quick planning layer for media decisions, and not a full-fledged P&L model.
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