E-commerce
Profit on ad spend (POAS)
The gross profit from ad-driven sales divided by ad spend.
What it is
POAS replaces revenue with profit, so a sale of a high-margin product counts for more than a discounted one of the same price.
Why it matters
For e-commerceIt steers budget toward the products and campaigns that make money, which ROAS cannot do when margins differ.
How it is measured
Formula
POAS = gross profit from ad sales / ad spendSend profit (or margin) as the conversion value instead of revenue, or calculate it afterwards from order data.
A common mistake
Sending profit values without keeping them current, so price or cost changes quietly mislead the bidding.
All terms