Google Ads ROAS Target

ROAS target: revenue / ad spend. B2B SaaS 3-5x typical. E-commerce 4-8x. Calculate based on margin, CAC payback target, LTV.

Target ROAS
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Min Profitable ROAS
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Industry Benchmark
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Gross margin—
Customer LTV—
Payback target—
Industry—
Your target ROAS—
Minimum ROAS—
Industry benchmark—
Ad Space

Google Ads ROAS (Return on Ad Spend) target depends on your gross margin, customer LTV, and CAC payback period. B2B SaaS typically targets 3-5x ROAS. E-commerce 4-8x. Use this as input to Google's Target ROAS bidding strategy.

Calculating Your Target

Target ROAS = LTV / Target CAC. Where Target CAC = LTV × Gross Margin / (Payback Target / 12). Example: $5K LTV, 70% margin, 12-month payback = $292/month margin = need $3,500 CAC max = 1.4x ROAS minimum. For 3:1 LTV:CAC ratio: $5K / $1,667 = 3x ROAS.

Industry Benchmarks 2027

B2B SaaS: 3-5x typical, 2-3x acceptable. E-commerce: 4-8x typical. Subscription box: 6-10x. Lead gen: 2-3x (per qualified lead). Mortgage/Insurance: 3-5x. Education: 4-6x. Use as starting reference, not absolute.

Google Target ROAS Strategy

Set up Target ROAS bidding in Google Ads. Algorithm bids to hit your target. Requires 30-day data on conversions to function. If consistently above target: lower it (be more aggressive). Below: raise it (more efficient). Optimize quarterly.

Last updated May 2026. Sources: Google Ads ROAS Guide.