YourCompetitor'sROASIsIrrelevant
"Our competitor is hitting 8x ROAS. Why are we only at 4x?"
We hear this regularly. And the answer is always the same: their ROAS is irrelevant to your business.
ROAS is not a universal benchmark. It's a function of your specific business economics.
A competitor with 70% gross margins can run profitably at 3x ROAS. If you're at 35% margins, you need 6x just to break even. Comparing the two numbers without comparing the underlying economics is meaningless.
But it gets worse. You don't know their:
- Return rate (which could be destroying the revenue their ROAS is based on)
- Discount depth (which could mean their "revenue" is 30% less than reported)
- Brand vs non-brand split (they might be counting branded searches you can't replicate)
- Customer lifetime value (they might be acquiring at a loss intentionally)
- Attribution model (their "8x" might be your "4x" measured differently)
The only ROAS that matters is the one that generates profit in your P&L.
We calculate your breakeven ROAS at the SKU level, accounting for your actual margins, returns, and fulfilment costs. That's your target. Not someone else's vanity metric.
Stop benchmarking against numbers you can't verify. Start benchmarking against your own P&L.