ROAS vs ROI, CPC vs CPM: What Is the Difference?

The formulas below are the standard ones. Google's own pages use the same CTR, CPC, CPM and ROAS sums, and Amazon's ad guide gives the ACoS one.

ROAS asks: how much revenue came back per ad dollar? ROI asks: how much profit came back per dollar of total cost?

Made-up example: you spend $1,000 on ads and sell $4,000 of product that cost you $2,200 to make and ship. ROAS is $4,000 / $1,000 = 4. Profit is $4,000 - $2,200 - $1,000 = $800. Total cost is $2,200 + $1,000 = $3,200, so ROI is $800 / $3,200 = 25%.

ROAS is what you steer the ad account by every day, because the platform can see it. ROI is what tells you if the business is working. Is ROAS the same as ROI? No, and a high ROAS can sit on a negative ROI when margins are thin.

CPC is cost per click. CPM is cost per thousand impressions. Which is better depends on the goal, not the label. Google's own help page puts it this way: pick viewable CPM if you care more about your ads being viewed than about clicks, and CPC if you care more about clicks. For online sales, Google says Maximize clicks or Maximize conversions bidding may be the better option.

Is Google Ads CPC or CPM? Both exist. Search ads are paid per click. Display ads can be paid per click or per 1,000 viewable impressions.

The two are linked by CTR: CPC = CPM / (CTR x 1,000). A $5 CPM at a 1% CTR is a $0.50 CPC.

CPC is what one click costs. CPA is what one sale (or lead) costs. A cheap click that never buys is an expensive sale, so stores should judge campaigns by CPA or ROAS, not CPC.

CPC and PPC are not rivals. Google says CPC pricing "is sometimes known as pay-per-click (PPC)." PPC is the model, CPC is the price inside it.

ACoS (advertising cost of sale) is Amazon's metric. It is ROAS turned upside down: Amazon's guide says ROAS "is the inverse of Amazon ACOS." An ACoS of 25% is a ROAS of 4.

TACoS (total advertising cost of sale) is ad spend divided by all sales, including sales that did not come from an ad. Sellers use it to see whether ads grow the whole business.

iROAS (incremental ROAS) counts only the sales the ads caused, the ones that would not have happened without them. You need a holdout or lift test to measure it. Normal ROAS also credits sales that would have happened anyway, like a returning customer searching your brand name.

Day to day: conversion value / cost (ROAS) per campaign, cost per conversion, and the share of sales from new customers. Weekly: CTR and impression share to spot problems early. Monthly: your blended ROAS from the store's own revenue against all ad spend, and your real profit.

Scaley works on Google Ads only, not Meta or TikTok. Scaley Media Buyer reads these numbers live, read-only, and answers when you ask. It only knows your product costs if you connect Shopify or tell it, so ROI stays a sum you check yourself.