Strong sales numbers don’t always mean strong profits. What actually remains after product costs, fulfillment, shipping, and advertising?
In this episode of PPC with YRV Dynamics, Yousaf Yunes breaks down PROAS—profit return on ad spend—and explains why advertisers need to understand the economics behind the results they report.
We walk through how COGS and other included costs affect returns, including an example where a campaign generating 4X ROAS leaves five times more money after advertising than one generating 6X ROAS.
You’ll learn:
• How PROAS differs from traditional ROAS.
• Where COGS, shipping, fulfillment, and fees fit into the calculation.
• Why you need to clearly define which costs your calculation includes.
• When to use PROAS to compare campaigns, evaluate product margins, and make budget decisions.
• Why money remaining after advertising still needs to cover any business expenses not already included.
Plus, we discuss why reporting profitability and optimizing toward it are separate steps: Reporting tells you what happened. The values used for bidding help determine what the platform pursues next.
Before increasing your ad budget, look beyond what you sold. Understand what those sales left you.
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