Facebook Ads ROI Calculator

Formula and inputs

Monthly net profit equals attributed revenue minus all monthly costs, including ad spend, creative refresh, and tools. ROI is cumulative net profit divided by the initial investment in setup and launch creative. Payback period shows how many months until that initial outlay is recovered.

Example scenario

DTC brand prospecting campaign

A skincare brand spends $2,000 producing launch creative and configuring tracking. The account attributes $7,200 in monthly revenue. Monthly costs total $4,800: $3,900 in ad spend, $600 in fresh creative, and $300 in tools. They model six months.

• -Initial investment: $2,000
• -Monthly revenue: $7,200
• -Monthly costs: $4,800
• -Time period: 6 months

Monthly net profit is $2,400 before product costs, so the launch outlay pays back in the first month. The catch: this is revenue, not contribution margin. If landed product margin is 60 percent, recompute with $4,320 as the revenue line and the picture tightens considerably.

Common mistakes

• -Modeling revenue instead of contribution margin for physical products with real COGS and shipping.
• -Treating creative production as free because it happens in-house.
• -Trusting platform attribution windows that claim credit for sales that would have happened anyway.

How to interpret the output

• -If ROI only clears zero at full platform-reported attribution, run a holdout or at least a conservative discount on reported revenue.
• -Strong early payback with declining monthly revenue is the signature of creative fatigue; budget more refresh, not more spend.
• -If margin-adjusted ROI is negative but the account drives first orders of a repeat-purchase product, model LTV separately before killing it.

Related tools

Related articles