Definition
tROAS (target ROAS) is a smart bidding strategy in Google Ads that automatically adjusts bids to hit a set target for return on ad spend.
Also called: tROAS, Target ROASBidding follows the signal you send.
Conversion value
Choose a value signal that reflects the business: revenue or relevant contribution.
Target and budget
Agree what a conversion is worth and how much to invest.
Evaluation
Compare channel results with actual sales and economics.
01Choose a value signal that reflects the business: revenue or relevant contribution.
tROAS is only as smart as the value you feed it
tROAS optimises toward whatever it sees as value. Send revenue and it chases revenue, shovelling budget toward products that sell a lot, regardless of margin. Send contribution margin as conversion value and it bids for actual profit. Same strategy, opposite outcome.
Set the target relative to break-even: your break-even ROAS is 1 divided by your margin rate. The tROAS target should sit meaningfully above that, so there's profit after ad cost, and ideally differentiated per margin bucket via custom labels.
Frequently asked questions
How do I set a sensible tROAS target?
Start from your break-even ROAS (1 / margin rate) and add a profit requirement on top. If you feed contribution margin as conversion value, the target can be set uniformly across the board, because the value already reflects margin.
Why isn't my tROAS target enough on its own?
Because it optimises toward the value you send. Send revenue and it favours low-margin volume. The fix is to send contribution margin as conversion value, so tROAS chases profit.
From insight to action
See how it applies in practice.
Website, channels and profit measurement
The Løgbutikken engagement covered the website, email, Meta, Google Ads and ProfitMetrics. The business grew and was subsequently acquired.
Read the caseMeasurement and customer economics
Discuss measurement and bidding
We review the values you measure and how they can inform budget decisions.
Choose a time30 minutes · No obligation
About the author
Malthe Ærbo Weibeck
Pull specialist with 8+ years' experience. Comes from the agency world and has since worked as an independent consultant for several of the country's largest brands.
Meet the team