Should I judge my campaigns by ROAS or by cost per acquisition?
If your order values vary a lot from one order to the next, rely on ROAS, because it takes basket size into account. If you sell one product at a fixed price or collect leads that are all worth about the same, cost per acquisition (CPA) is simpler and enough. Either way, neither one judges profit without your margin.
Two campaigns with identical CPA
Two campaigns each spent 1,000 AED and each brought in 20 orders. In the Campaign performance calculator each shows a CPA of 50. By cost per acquisition they are exactly equal.
But the first advertised a small product with an average basket of 150, so its sales totalled 3,000. The second advertised a gift set with an average basket of 300, so its sales totalled 6,000. Enter each in the ROAS calculator with a 35% margin:
- Campaign one: ROAS 3x, ad share of revenue 33.33%, break-even 2.86x, verdict above break-even with an estimated profit of just 50.
- Campaign two: ROAS 6x, ad share 16.67%, verdict above break-even with an estimated profit of 1,100.
CPA said the two campaigns were the same; ROAS showed that one barely pays for itself and the other earns more than twenty times as much.
When CPA is the better yardstick
- When you sell a single product at a fixed price. Every order is worth the same, and the two metrics say the same thing in different words.
- When the campaign collects leads, such as quote requests or consultation bookings, and no purchase value is sent to the platform.
- When order value tracking is unreliable in your store but the order count is reliable.
Linking CPA to profit
Break-even CPA = average order value × margin before ads. For campaign one: 150 × 35% = 52.5, so a CPA of 50 leaves just 2.5 per order, or 50 across 20 orders, the same profit the ROAS calculator showed. For campaign two: 300 × 35% = 105, so a CPA of 50 is very comfortable.
In other words, the two metrics reach the same verdict once you bring in margin and basket size. The trouble starts when you set one CPA target for every campaign even though their baskets differ.
A practical way to use both
- Work out your margin before ads carefully in the Profit margin calculator; it underpins both metrics.
- Use the ROAS calculator to see whether a campaign makes money, and the campaign performance calculator to see where it breaks down if not: clicks, conversion or cost per order.
- Watch average order value per campaign. If it drops, CPA can stay flat while ROAS falls.
Common questions
Does the ROAS calculator work out CPA?
No, it does not ask for the number of orders. You get CPA from the campaign performance calculator using the same spend and your conversion count.
Which one do ad platforms show?
Cost per result needs only a conversion count, while a ROAS column needs your tracking to send purchase value. Check your dashboard settings.
Is there an ideal CPA?
We do not give benchmarks. An acceptable CPA is anything below your average basket times your margin.