ROAS
Written by Hylke Reitsma, co-founder of TouchDrop
ROAS — Return on Ad Spend — measures how much revenue a campaign generates for every dollar spent on it. The formula is simple:
A ROAS of 3x means every $1 spent returned $3 in revenue. A ROAS of 1x means you broke even. Below 1x, the campaign cost more than it returned.
ROAS for direct mail
In direct mail, campaign spend includes the cost per postcard (print + postage) multiplied by the number of postcards sent. Revenue is measured by attributing orders back to the campaign within a set attribution window.
Because direct mail has a physical cost per piece, it operates at lower volumes than digital campaigns — but the physical channel often achieves higher conversion rates, which can make ROAS comparable or superior to email and paid social for the right use cases.
How TouchDrop calculates ROAS
TouchDrop attributes orders three ways, in priority order:
- Discount code redemptions — Each postcard includes a unique Shopify discount code, and its QR code opens your store with that code applied. When the code is used at checkout, the order is attributed to the campaign whenever it is placed.
- Customer email match — An order placed without the code, using the email address of a mailed recipient, is attributed to the campaign if it falls within the attribution window.
- Shipping address match — Failing both, an order shipped to a mailed address within the attribution window is attributed to the campaign.
Campaign ROAS is displayed in the TouchDrop dashboard in real time as orders come in, using a 60-day attribution window that opens on the card's estimated delivery date.
Practical ROAS benchmarks for direct mail
Direct mail ROAS varies significantly by campaign type, product category, and offer strength. Win-back campaigns targeting lapsed high-LTV customers typically achieve the highest ROAS because the audience is pre-qualified and the acquisition cost has already been paid. Abandoned cart campaigns often achieve strong ROAS because intent is already signalled at checkout.
Related terms and reading
Want to see these concepts in action?
Try TouchDrop free