What break-even ROAS means
ROAS (return on ad spend) is revenue divided by ad spend. Your break-even ROAS is price ÷ profit per order before ads. If you sell at $40 and keep $20 before ads, you break even at 2.0x: every $1 of ads must bring $2 of sales.
High-margin products can run ads at a low ROAS. Thin-margin products need a high ROAS, which is why fees and costs matter as much as the ad itself.
FAQ
What is a good ROAS?
It depends on your margin. A good ROAS is any ROAS above your break-even ROAS. For a 50% margin that is anything above 2x; for a 25% margin you need above 4x.
How is break-even ACoS related?
Break-even ACoS is your margin before ads. It is the same idea as break-even ROAS, written as ad spend ÷ ad sales.