Average ROAS describes money already spent, rather than what the next euro will achieve. As budgets grow, platforms reach more expensive impressions and audiences less ready to buy, so marginal returns typically change.
Build a spending-and-outcome curve
Use historical changes, geographic tests or controlled budget increments. Avoid comparing days with different demand and creative.
Measure incrementality where possible
Attributed conversions can redistribute credit without adding sales. Holdouts and experiments help estimate the genuinely additional outcome.
Separate channels and segments
The marginal curve differs by country, audience, placement and period. An overall average hides where efficient growth remains possible.
Include capacity and margin
Additional sales may increase support, returns or fulfilment costs. Business performance extends beyond the advertising platform.
Define a reallocation rule
Place the next euro where expected marginal value is highest within risk limits. Reassess regularly as the curves change.
This framework is an original DigitalNow editorial methodology.