What this means
Meta may report attributed purchase value, but the seller still pays for product cost, shipping, payment fees, discounts, packaging, refunds, and ad spend. A 3x ROAS can be safe for one product and risky for another.
Formula
Use net revenue after discounts. Then subtract variable costs to find contribution margin. If your Meta Ads ROAS is below break-even, the campaign may lose money before fixed overhead.
Example
If net revenue is $45 and contribution margin before ads is $15, break-even ROAS is 3.00x. A Meta campaign at 2.7x needs review before increasing budget.
Common mistakes
- Using gross purchase value instead of revenue after discounts.
- Ignoring CPA when ROAS looks acceptable.
- Comparing blended ROAS to one product with a different margin.
- Scaling before checking refund and return impact.
Calculator
Add your product numbers and current Meta ROAS to see break-even ROAS, CPA room, and profit after ads.
Calculate Meta break-even ROAS