Google Ads can generate orders, but store owners need to understand what remains after expenses. Looking only at revenue in the ad account is not enough. You need margins, actual payments, returns and customer acquisition costs.

Start with a simple financial calculation for a product or product group. It helps set advertising targets and assess results without confusing turnover with profit.

How CPA and ROAS differ

CPA is ad spend divided by the number of selected conversions. If a conversion is a purchase, it describes the cost of acquiring a purchase. If calls or add-to-cart actions are also counted, the number means something different. Check which actions the report includes before assessing it.

ROAS is conversion value divided by ad spend. If the value is revenue, a ROAS of 5 means UAH 5 of revenue per UAH 1 of advertising, or 500%. It is not profit: product costs and other expenses still have to be covered. The metric and Target ROAS strategy are explained in Google Ads Help.

Calculate an acceptable acquisition cost

Take the selling price and subtract product costs and variable expenses for fulfilling that order. Then determine the contribution you need to retain towards fixed costs and profit.

A hypothetical example, not a Bei Agency client result:

  • Revenue per order: UAH 2,000.

  • Product cost: UAH 1,300.

  • Packaging, fees and other variable expenses: UAH 200.

  • Remaining before ad spend: UAH 500.

In this simplified example, a CPA of UAH 500 uses the entire remainder. Fixed costs and profit are still not covered. To retain UAH 200, the acceptable CPA is UAH 300. The corresponding revenue-based ROAS target is 2,000 ÷ 300 ≈ 6.67, or 667%.

This calculation applies to the stated conditions, not every store. Taxes, returns, subsidised delivery and purchasing price changes can alter acceptable acquisition costs. Include them in your model without subtracting the same expenses twice.

Do not mix products with different economics

Two categories with identical revenue can leave different amounts after product costs. Average store-wide ROAS can hide this difference.

Group products for analysis by margin, price, demand or stock availability. For each group, check spending, orders and financial contribution. Base campaign structure decisions on data volume: excessive fragmentation also complicates management.

Track products that are frequently ordered but not collected separately. An attractive ad report does not explain return shipping costs or managers’ time.

Compare advertising with actual orders

Check purchase value and currency transmission and conversion tracking accuracy. Incorrect purchase amounts distort the input data for value-based bidding. Google explains measurement for Google Ads product campaigns in its automated bidding guidance.

Compare ad account results with store records for the same period. Account for delays between clicks, orders and payment, as well as cancellations. With payment after delivery, new orders do not yet provide a final financial result.

How to use Target ROAS

Target ROAS sets a target for automated bidding. It does not guarantee the specified return on every order. An excessively high target that ignores history and demand can restrict traffic opportunities.

Agree with your specialist on the initial target, evaluation period and adjustment process. Monitor sales volume and financial results together. A high ROAS on a few orders does not necessarily meet a business growth goal.

Bei Agency helps connect advertising metrics to store economics. Learn more on our Google Ads. To discuss your catalogue and goals, contact us.