Skip to content
Tweak Your Biz home.
MENUMENU
  • Home
  • Categories
    • Reviews
    • Business
    • Finance
    • Technology
    • Growth
    • Sales
    • Marketing
    • Management
  • Who We Are

What Is POAS in Marketing and How Is It Used in Google Ads?

By Manish Kuwar Published March 3, 2021 Updated March 17, 2023

Profit on Ad Spend (POAS) is a return on investment metric for online marketing and advertising campaigns. ROAS short form for Return On Advertising Spending. But actually is mostly used in eCommerce as revenue on ad spends.

This is why POAS marketing is the next big thing in PPC marketing and it’s time to get on board. You might be starting to hear about POAS, not only from Google ads but also when bidding for profits.

It’s important to think about the difference between profit and revenue when optimizing and bidding in Google ads, because you will be bidding for the bottom line (POAS) instead of the top line (ROAS) which includes taxes, shipping, etc. This means that your profit on ad spend will include costs like product cost prices, payment feeds, and shipping expenses. So you are seeing the full transparency of your marketing spend.

This way you can let Google and Facebook algorithms optimize for the profit instead of the revenue. This allows them to show when they have reached their break-even point which should be at one (1), because this is where they make equal amounts of both profits as well as advertisement spends. If it goes over one then that means that they will continue making a profit, but if they go below one then this implies that there were not able to generate enough money from adverts or sales in order to cover all expenses

This tactic will increase the profitability of your ad spend and can allow you to scale much more. Simply by shutting down all the ads that are not profitable, and allocating your budget where it makes a profit.

In Google shopping, the highest ad spend is allocated to where the revenue comes and it often happens that products with a lot of competition and high searches are there. But this is also sometimes where you can be unprofitable and products with lower revenues often bring in profit because accessories have higher margins.

One of the major reasons why eCommerce market leaders are moving to use POAS as the main KPI in marketing channels like Google and Facebook is because they can outbid and outperform their competitors.

Conclusion

You may be asking yourself why more businesses aren’t using profit as a metric instead of revenue. The problem is that it’s extremely difficult to get Profit bidding up and running. However, new companies are starting to develop this type of software so everyone can use it, not just the Fortune 500 companies

Computer mouse: concept of pay per click -DepositPhotos

Posted in Marketing

Enjoy the article? Share it:

  • Share on Facebook
  • Share on X
  • Share on LinkedIn
  • Share on Email

Manish Kuwar

I am an enthusiastic Learner. Always open to new ideas and suggestions.

Contact author via email

View all posts by Manish Kuwar

Signup for the newsletter

Sign For Our Newsletter To Get Actionable Business Advice

* indicates required

Related Articles

Marketing
Technology

Show Up in AI Overviews with Yelp SEO

James Harding August 7, 2025
Business
Marketing

5 Key Marketing Lessons B2B Brands Can Learn From D2C Marketers

Garrett Smith July 30, 2025
Marketing

How to Use Coupons Effectively in Your Marketing Strategy?

Chad Wyatt July 9, 2025

Footer

Tweak Your Biz
Visit us on Facebook Visit us on X Visit us on LinkedIn

Privacy Settings

Company

  • Contact
  • Terms of Service
  • Privacy Statement
  • Accessibility Statement
  • Sitemap

Signup for the newsletter

Sign For Our Newsletter To Get Actionable Business Advice

* indicates required

Copyright © 2025. All rights reserved. Tweak Your Biz.

Disclaimer: If you click on some of the links throughout our website and decide to make a purchase, Tweak Your Biz may receive compensation. These are products that we have used ourselves and recommend wholeheartedly. Please note that this site is for entertainment purposes only and is not intended to provide financial advice. You can read our complete disclosure statement regarding affiliates in our privacy policy. Cookie Policy.

Tweak Your Biz
Sign For Our Newsletter To Get Actionable Business Advice
[email protected]