RedClawLabs

Ad math calculators

These four calculators use your own price, costs and conversions to find the point where ads stop losing money: gross margin sets what you can spend, break-even ROAS and max CPA tell you when to stop, and conversion rate tells you whether the problem is the page or the budget.

What you type is calculated in your browser and is never sent or stored. The site-wide analytics are described in the privacy policy.

CalculatorAnswersFormula
Gross margin calculatorWhat each sale leaves you, and how margin differs from markupGross margin = gross profit ÷ price × 100%
Break-even ROAS calculatorThe ROAS your ads must beat to stop losing moneyBreak-even ROAS = order value ÷ contribution per order
Max CPA calculatorThe most one order, and one click, can cost in adsBreak-even CPA = order value − variable cost per order
Conversion rate calculatorYour rate, whether the sample is big enough, and visitors neededConversion rate = conversions ÷ visitors × 100%

One order, worked through all four

The same order through all four calculators: order value 1,200, goods 480, shipping, payment fees and packing 240 together, a profit of 10% of the order kept back, and a 2% conversion rate on the product page.

NumberWorkingResultCalculator
Contribution per order1,200 − 480 − 240480Break-even ROAS calculator
Contribution margin480 ÷ 1,20040%Gross margin calculator
Break-even ROAS1,200 ÷ 4802.50Break-even ROAS calculator
Break-even CPA= contribution per order480Max CPA calculator
Target CPA480 − 1,200 × 10%360Max CPA calculator
Target ROAS1,200 ÷ 3603.33Max CPA calculator
Affordable CPC360 × 2%7.2Max CPA calculator
Visits for 10 orders a day10 ÷ 2%500Conversion rate calculator

If this business reports a ROAS of 3, it is making money but is short of its 3.33 target; at 2.2 every extra sale loses a little more. In the accounts we handle, we fill in this table first, then decide whether to add budget, change creative or fix the page: low ROAS with a normal conversion rate usually points at creative or audience; if conversion drops to 1%, the affordable CPC halves to 3.6, so fix the page before talking budget.

Which to work out first

Suggested order: gross margin first, then break-even ROAS with shipping and fees added, then max CPA, then conversion rate to check the page.

FAQ

Margin or markup: which one sets the ad threshold?

Margin, and more precisely contribution margin after shipping, payment fees and packing. Markup divides by cost, so a break-even ROAS worked out from it comes out too low and losing orders look profitable.

Should I watch ROAS or CPA?

When orders are all about the same value, CPA is enough. When order values vary a lot (add-ons, bundles), watch ROAS, because it accounts for each order bringing in different revenue. Both thresholds come from the same contribution, so they never disagree.

Does break-even ROAS include rent and salaries?

No. It covers the variable cost of each order only: goods, shipping, payment fees, packing. Check fixed costs separately with the month’s total revenue divided by total ad spend (MER).

Are the numbers I type recorded?

No. The calculation runs in your browser; the page does not send or store what you type or put it in the URL.

Sources


Work out your stop, target and scale lines from your own numbers.

Intermediate, chapter 5 puts shipping, free-shipping offers, payment fees, returns and payment success into cost, and builds the cost sheet in Google Sheets. Read online, one-time purchase; the opening chapters of each level are free.