Advergent Ads Benchmarks
Break-even ROAS equals one divided by contribution margin — and the result, combined with the learning budget, decides whether a campaign is testable at all.
Step one is the contribution margin: revenue from a sale minus the variable costs of fulfilling it, expressed as a percentage. Step two divides one by that percentage. A 30% margin needs 3.3x revenue per ad dollar to break even, a 20% margin needs 5.0x, and a 10% margin needs 10x.
Step three checks feasibility against channel benchmarks. At a $1.50 CPC and a 2% conversion rate, one conversion costs about $75; the average order must therefore repay $75 of ad spend at the required ROAS. If the margin is 20% and the order is $100, the campaign needs 5.0x and the arithmetic already fails before a dollar is spent.
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Step four is the learning budget. Google's learning phase ends at roughly 50 conversions per campaign per week; at a 2% conversion rate that is 2,500 clicks, and at $1.50 per click about $3,750 a week — roughly $535 a day. A budget below that line leaves the campaign stuck in learning, where week-to-week results are too unstable to judge.
Step five confirms headroom in the auction. Target impression share is 70% or more on brand terms and 20-30% on generic terms; below 15% on generics the budget, not the ad, is the limit. A campaign can pass the margin test and still be untestable because the budget cannot buy enough data.
Two reporting details belong in the same calculation. Google Ads' default attribution window credits conversions to a click for 7 days and to a view for 1 day, so this week's reported ROAS partly describes last week's clicks. And on Meta, frequency above 3-4 per user per week degrades CTR by 15-25%, so a ROAS that clears break-even at launch can sink below it as the audience saturates — the Meta benchmarks page details that decay.
Further reading