ROAS is a Lazy Metric

ROAS feels precise, objective, and reassuring. That is exactly what makes it dangerous.

As a metric, ROAS answers a narrow question: how much revenue was generated for every unit of advertising spend. What it does not answer is whether that revenue was incremental, sustainable, or strategically valuable. Yet many organizations treat ROAS as the primary measure of marketing success.

The problem is not ROAS itself. The problem is what happens when ROAS becomes the dominant decision lens. Teams begin optimizing for short-term efficiency rather than long-term growth. Budgets shift toward low-risk audiences who were likely to convert anyway. Upper-funnel activity gets deprioritized because it depresses ROAS in the short term. Over time, demand creation weakens while performance metrics continue to look healthy.

High ROAS can coexist with declining market share. It can mask shrinking customer pools and rising dependency on repeat buyers. In extreme cases, it rewards teams for harvesting existing demand while starving future growth. When this happens, marketing appears to be working right up until it suddenly stops.

More mature organizations use ROAS as one input, not the final answer. They pair it with incrementality testing, contribution margins, and customer lifetime value. They ask whether growth is coming from new demand or simply from reallocating credit. They accept that some forms of growth are intentionally inefficient in the short term because they create long-term leverage.

ROAS is not a strategy. It is a reporting metric. When leaders elevate it to a strategic role, they outsource judgment to a number that was never designed to carry that responsibility. Strong marketing leadership is not about finding the perfect metric. It is about knowing which questions a metric can answer and which ones it cannot.