Business superintelligence that acts.
Profit, not ROAS:
ROAS went up. Cash went down. Here is why.
Profit by campaign and by product, from your own cost of goods, discounts, refunds and returns.
4.1x ROAS on the platform. A loss of $3,200 in the store.
| Measure | The platform shows | The store recorded |
|---|---|---|
| Ad spend | $9,400 | $9,400 |
| Revenue | $38,500 (4.1x ROAS) | $36,100 recorded |
| Discount | not counted | $7,200 |
| Cost of goods | not counted | $18,050 |
| Refunds and returns | not counted | $2,900 |
| Shipping | not counted | $1,750 |
| Profit after ad spend | looks like +$29,100 | −$3,200 |
Break-even from your own cost of goods. Illustrative account.
What ROAS leaves out.
Return on ad spend divides platform-reported revenue by ad cost. It does not know what the product cost you, what you discounted, what was refunded or returned, or what it cost to ship. A campaign at 4x ROAS on a product with a 20% margin after discount is losing money on every order.
What is counted instead.
Break-even is worked out from your cost of goods per product. Contribution is revenue after cost of goods, discounts, refunds, returns and shipping. Profit is shown by campaign, by product and by month, next to the ad spend that produced it. When the platform's revenue and the store's recorded revenue disagree, you see both and the size of the gap.
What to push and what to stop.
Product by product: which ones the ads should push, which ones lose money on every advertised order, and which ones are out of stock while the ads still run.
One campaign, both ways:
One campaign: a winner by ROAS, a loser by profit.
| Campaign: Hero hoodie, Meta | What the platform shows | What the store recorded |
|---|---|---|
| Ad spend | $9,400 | $9,400 |
| Revenue | $38,500 (4.1x ROAS) | $36,100 recorded orders |
| Discount | not counted | $7,200 (20% code) |
| Cost of goods | not counted | $18,050 |
| Refunds and returns | not counted | $2,900 |
| Shipping | not counted | $1,750 |
| Contribution after ad spend | looks like +$29,100 | -$3,200 |
Illustrative account, one campaign, one month. Figures invented to show the format.
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