What is a good ROAS? The honest answer for Shopping
Why there's no universal good ROAS, how to calculate your break-even from margin with worked examples, category benchmarks with caveats, and when a lower ROAS is the smarter target.
There is no universal good ROAS, a 400% ROAS is comfortably profitable at 60% margin and a guaranteed loss at 20% margin. The number that matters is your break-even ROAS, which comes straight from your gross margin (roughly 1 ÷ margin). This guide works the maths with examples, gives category benchmarks with the caveats they deserve, and explains why the best ROAS target is sometimes lower than the one you're hitting.
Why "what is a good ROAS" has no universal answer
Ask what a good ROAS is and you'll hear numbers from 300% to 800%, all delivered with confidence, all meaningless without one more piece of information: your gross margin. ROAS measures revenue per pound of ad spend: but revenue isn't profit, and how much of each revenue pound you keep varies enormously between businesses and between products in the same catalogue.
Two merchants both hitting 400% ROAS:
- Merchant A sells candles at 65% gross margin. £100 of spend brings £400 of revenue carrying £260 of gross profit: £160 profit after ad spend. Excellent.
- Merchant B sells consumer electronics at 18% margin. Same £100, same £400 revenue: but only £72 of gross profit. A £28 loss on every £100 spent, at a ROAS most people would call "good".
Same number, opposite outcomes. Any ROAS discussion that skips margin is astrology. (The full revenue-vs-profit argument is in ROAS vs POAS.)
Start from break-even: the maths in two minutes
Your break-even ROAS is the point where gross profit from ad-driven sales exactly covers the ad spend:
Break-even ROAS ≈ 1 ÷ gross margin
| Gross margin | Break-even ROAS | A "good" ROAS looks like |
|---|---|---|
| 15% | 667% | 800%+ |
| 25% | 400% | 500%+ |
| 35% | 286% | 380%+ |
| 50% | 200% | 280%+ |
| 65% | 154% | 220%+ |
Worked example at 35% margin: break-even is 1 ÷ 0.35 ≈ 286%. Below 286%, every order loses money. At exactly 286%, ads pay for themselves and nothing else. A sensible working target sits 20–40% above break-even (say 350–400%) leaving genuine profit after the ads while keeping enough auction volume to matter.
Use gross margin after variable costs: product cost, payment fees, shipping you absorb, packaging. Using list-price margin flatters the maths and quietly moves your real break-even above your target.
One prerequisite before trusting any of this: the ROAS in your reports is only as honest as your conversion tracking. Broken or double-counted revenue makes every threshold in this article fiction.
Benchmarks by category: with the caveats attached
For orientation only, published ecommerce studies put typical Google Shopping ROAS in these bands:
| Category | Typical reported range |
|---|---|
| Fashion and apparel | 300–500% |
| Home and garden | 300–450% |
| Beauty and personal care | 250–450% |
| Electronics | 200–350% |
| Food and drink | 250–400% |
| Furniture / high-ticket | 200–400% |
Now the caveats, which matter more than the table:
- Within-category spread beats between-category spread. The gap between a well-run and badly-run fashion account is far wider than the gap between fashion and electronics averages.
- Benchmarks mix incomparable strategies. Some accounts in every average are deliberately running near break-even to grow; others are harvesting brand demand at 900%. The average of those describes nobody.
- Attribution differences make cross-account comparison shaky: a 30-day-click account and a data-driven-attribution account report different ROAS on identical performance. See attribution.
- Margins differ within categories too. "Electronics" spans 8%-margin consoles and 60%-margin cables.
The right use of a benchmark: if you're wildly below the band and below your break-even, something is broken. The wrong use: adopting the category average as your target because it's a number and it's there.
Deep dive ROAS targets vs growth: why the "best" ROAS is often lower
The least intuitive fact about ROAS: maximising ROAS and maximising profit are different goals, and they point at different targets.
ROAS and volume trade off mechanically. A tROAS target is a throttle: raise it and Google exits every auction that can't clear the new bar, so spend and sales shrink as the percentage climbs (see how tROAS works). Push far enough and you'll have a beautiful 900% ROAS on £8 a day: maximum efficiency, negligible profit.
Worked example, 40% margin (break-even 250%):
| Target | Monthly spend | Revenue | ROAS | Gross profit − ad spend |
|---|---|---|---|---|
| 600% | £1,000 | £6,000 | 600% | £1,400 |
| 450% | £2,500 | £11,250 | 450% | £2,000 |
| 350% | £5,000 | £17,500 | 350% | £2,000 |
| 280% | £8,000 | £22,400 | 280% | £960 |
Peak profit sits somewhere around 350–450%: well below the peak ROAS. And the 350% row buys something the table doesn't show: nearly triple the customers of the 600% row, each one a repeat-purchase and lifetime-value opportunity. That's why growth-stage merchants deliberately run closer to break-even: they're buying market share and conversion data with margin they could have banked.
So "what's a good ROAS" resolves into a strategy question with three honest answers:
- Harvest mode: established products, no growth push: target comfortably above break-even and bank the margin.
- Balanced: most accounts, most of the time: 20–40% above break-even.
- Growth mode: new products or a land-grab: at or barely above break-even, deliberately, for a defined period, funded knowingly.
The final wrinkle: this decision isn't really account-level. Break-even varies per product with margin, and the volume trade-off varies with each product's demand: so the profit-maximising target differs product by product. A single campaign ROAS averages across all of them, starving some and overfeeding others. Working out what each product could individually sustain is exactly the job of product-level tROAS analysis: surfaced as recommendations you approve, not targets changed behind your back.
How to set your own number
- Compute break-even per margin band: 1 ÷ gross margin, using real variable costs.
- Pick your mode (harvest, balanced, or growth) per product line, not just per account.
- Set targets from trailing reality, not aspiration. Start near your actual 30-day ROAS and step toward the goal in 10–20% moves.
- Judge profit, not the ratio. A falling ROAS with rising total profit is usually a win. A rising ROAS with collapsing spend is usually a slow retreat.
- Re-run the maths when costs change. A supplier price rise moves your break-even overnight; your target should follow.
The one-line answer to the question in the title: a good ROAS is one that clears your break-even by enough to fund your current goal. Everything else is someone else's number.
Frequently asked questions
What is a good ROAS for Google Shopping?
The honest answer, whatever clears your break-even with room for profit and growth. Break-even ROAS is roughly 1 ÷ gross margin, so at 30% margin you need 333% just to break even, and a "good" ROAS might be 450–500%. At 60% margin, 250% can be excellent. Anyone quoting one number for everyone is guessing.
Is a 4x (400%) ROAS good?
It depends entirely on your margin. At 50% margin, 400% ROAS means roughly £1 of gross profit per £1 of spend, genuinely good. At 25% margin, 400% is exactly break-even, you're working for free. At 15% margin, it's a loss on every order.
What's the average ROAS for Google Shopping ads?
Published studies cluster around 200–400% across ecommerce, but the spread within any category dwarfs the difference between categories. Averages mix broken tracking, loss-leader strategies and mature accounts, treat them as trivia, not targets.
Should I always aim for the highest ROAS possible?
No. ROAS and volume trade off, pushing the target up throttles spend, so a very high ROAS often means a small, shrinking campaign. Maximum-profit ROAS is almost always lower than maximum-ROAS ROAS. Growth-stage accounts deliberately run closer to break-even to buy market share and data.