Better ROAS is not always a better business.
By Simon Ellicott · September 25, 2026 · Curated by George's Blog
Better ROAS is not always a better business.
This is one of the simplest traps in Amazon advertising.
An agency reports that ROAS has improved.
The client is pleased. Everyone moves on.
But what if the campaign generated fewer sales?
What if the products being prioritised were already close to selling through?
What if the higher ROAS came from protecting branded demand rather than creating incremental growth?
What if the advertising result looked better because spend was reduced, while market share, ranking and future demand quietly weakened?
ROAS is a useful metric. It is not a business strategy.
A serious commercial review also needs to consider:
• Contribution margin and Net PPM
• Advertising as a percentage of total sales
• Incremental versus branded demand
• Stock availability and weeks of cover
• Buy Box ownership and retail readiness
• Promotional funding and discount depth
• The role of the product in the wider portfolio
• Whether the client is trying to grow, defend or harvest demand
A product can have a brilliant ROAS and still be a poor place to invest.
Another product may have a lower ROAS but be strategically important because it is launching, building category authority, driving new-to-brand customers or defending a key position.
The right question is not:
“How do we make ROAS look better?”
It is:
“What level and type of advertising investment best supports the commercial objective?”
Sometimes that means accepting a lower ROAS to accelerate growth.
Sometimes it means reducing spend on a supposedly efficient campaign because it is harvesting demand that would have arrived anyway.
Sometimes it means stopping the campaign altogether.
That is the difference between managing advertising and managing the business.
The agency’s job is not to make one metric look healthy, it is to understand what the metric is telling you, what it is hiding and what decision should follow.
Because the best advertising result is not always the most efficient one.
It is the one that creates the right commercial outcome.
#AmazonAdvertising #AmazonAgency #ROAS #RetailMedia #AmazonConsulting #EcommerceStrategy #NetPPM #AgencyLeadership
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