What Is Return on Ad Spend (ROAS)? Definition for Clinics

Return on ad spend, or ROAS, is how many dollars of revenue each ad dollar brought back. In November 2025, Rehab Lab, a cash PT client in Wisconsin, ran a STEMwave shockwave campaign that returned $30,000 in revenue on about $2,400 of spend: 96 leads and 17 plans of care. That is a ROAS of about 12.5x (our arithmetic: $30,000 / $2,400).

How do you calculate ROAS?

ROAS = revenue from ads / ad spend, over the same period. Google Ads uses the same idea and writes it as a percentage: "$5 USD in sales ÷ $1 USD in ad spend x 100% = 500% target ROAS" (Google Ads Help). Clinics usually say 5x instead. The hard part is the top number. You need to know which patients came from which ads, and what they paid, which means tracking source in your CRM from the first call or form, not guessing at the end of the month.

Should ROAS be based on deal value or cash collected?

Track ROAS on both deal value and cash collected, because they answer different questions. Deal value, the full plan of care sold, tells you whether the ads are bringing in buyers. Cash collected tells you what actually reached the bank, which matters when patients pay over time. When Rehab Lab's bank questioned a strong month, Jake built a ROAS sheet showing spend, cost per acquisition, and ROAS on deal value and on cash collected, by location, for the bank meeting. More in the Rehab Lab case study.

What ROAS does a clinic need?

The ROAS a clinic needs depends on its margin and lifetime value. A simple floor: break-even ROAS = 1 / profit margin before ad spend (our formula). At a 25% margin you need 4x on the first plan to break even, and at 40% you need 2.5x. Patients who return or join a membership raise the real return, so a clinic with strong retention can accept a lower first-purchase ROAS. Check your margin against our PT clinic profit margin benchmarks and compare it with your cost per new patient.