Google Ads ROI Calculator
To see if Google Ads pays off, follow the money from spend to revenue: spend → leads → customers → revenue. Enter your four numbers below and you'll instantly see your ROAS (return on ad spend), how many new customers your budget buys, the revenue it generates, and what each customer costs you.
Estimates only — real results depend on your market, tracking accuracy and how well leads are followed up. ROAS measures revenue, not profit; factor in your margin (see below) for true ROI.
How this calculator works
It follows one new customer's journey backwards from revenue, so you can see whether the spend is justified:
- Leads = ad spend ÷ cost per lead.
- New customers = leads × close rate.
- Revenue = new customers × average customer value.
- ROAS = revenue ÷ ad spend.
Worked example: $2,000 spend at a $50 cost per lead buys 40 leads. Close 25% of them and you win 10 customers. At $600 each, that's $6,000 in revenue from $2,000 spent — a 3× ROAS, at a cost of $200 per customer.
ROAS vs ROI — don't confuse them
ROAS compares revenue to ad spend. ROI compares profit to ad spend, so it depends on your margin. A 3× ROAS sounds great, but if your profit margin is only 30%, that $6,000 of revenue is ~$1,800 of gross profit — barely above the $2,000 you spent. The fix isn't to ignore ROAS; it's to know your break-even ROAS.
What's a good ROAS for you?
Forget generic benchmarks — your target is your break-even ROAS = 1 ÷ profit margin. Anything above it is profit.
| Your profit margin | Break-even ROAS | You're profitable above |
|---|---|---|
| 25% | 4.0× | 4× |
| 50% | 2.0× | 2× |
| 75% | 1.3× | 1.3× |
| 100% (most services) | 1.0× | Any return above spend |
Most local-service businesses have high margins, so they turn a profit at a far lower ROAS than a retailer would. That's why Google Ads can work so well for them.
How to push your ROI higher
- Lower the cost per lead — tighter keywords, better Quality Score, less wasted spend.
- Raise the close rate — fast follow-up and better-qualified leads turn more enquiries into customers.
- Increase customer value — upsells, repeat work and referrals all lift the revenue side of the equation.
If the numbers above don't look right yet, that's usually a tracking or targeting problem — and it's fixable. Get in touch for an honest read.
Frequently asked questions
ROAS compares revenue to ad spend (revenue ÷ spend, e.g. 3×). ROI compares profit to spend, so it factors in your margin. A healthy ROAS can still be break-even once costs are counted — which is why margin matters.
It depends on your margin. The real target is your break-even ROAS (1 ÷ margin). At a 50% margin you break even at 2×; anything above that is profit.
Estimate the customers your spend produces (leads × close rate), multiply by customer value for revenue, then compare to spend. For true ROI, multiply revenue by your margin, subtract spend, and divide that profit by the spend.
Often, but not always. At a 50% margin it's solidly profitable; at 25% it's roughly break-even. Always compare against your break-even point, not a generic benchmark.
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