Ad economics

Break-Even ROAS For Shopify

Break-even ROAS tells you how much revenue your ads need to generate before the product stops losing money. It is one of the quickest ways to spot fragile product economics.

What Break-Even ROAS Means

ROAS means return on ad spend. If you spend A$1 on ads and get A$2 in revenue, that is 2.0x ROAS. But revenue is not profit. Your product still has costs.

Why It Matters

If a product needs a very high ROAS just to break even, ads become harder to scale. A product with stronger contribution margin can survive more testing, imperfect conversion rates, and rising ad costs.

How To Improve It

• Raise the selling price with a better bundle or offer.
• Reduce landed cost or shipping cost.
• Increase average order value.
• Improve product page conversion rate.
• Reduce refunds by setting clearer expectations.