A brand allocates a media budget of $100,000 and anticipates generating $500,000 in revenue. What is the expected ROAS?

Return on Advertising Spend (ROAS) is a critical metric in digital media buying that indicates the revenue generated for every dollar spent on advertising. To calculate ROAS, you divide the expected revenue by the media spend and then multiply by 100 to convert it into a percentage.

In this scenario, with a media budget of $100,000 and anticipated revenue of $500,000, the calculation would be as follows:

1. Divide the expected revenue by the media budget:

( \frac{500,000}{100,000} = 5 )

2. Convert this number to a percentage by multiplying by 100:

( 5 \times 100 = 500% )

Thus, the expected ROAS is 500%. This means that for every dollar spent on advertising, the brand expects to generate five dollars in revenue. Understanding ROAS is important for marketers to gauge the effectiveness of their advertising campaigns and make informed budgeting decisions for future campaigns.