You only need POAS tracking if your margins are all over the place.

There’s a tool for everything now.

Plenty of them will track your profit on ad spend product by product, put a red flag on the ones losing money, and charge you every month for the privilege.

For some businesses, that’s money well spent. For others, it’s paying for a sum you could do on the back of a beer mat.

What POAS actually is.

ROAS is return on ad spend. Sales divided by what you spent on ads. Spend £1,000, make £4,000 of sales, that’s a ROAS of 4.

POAS is profit on ad spend. Same idea, but with the profit instead of the sales. Gross profit divided by what you spent on ads.

It’s a better number. ROAS on its own tells you bugger all until you know the margin. I’ve written the full sum up on the ecommerce Google Ads page.

One margin on everything? Do it in your head.

If you make your own stuff and it’s all on roughly the same margin, POAS is just your ROAS times your margin.

4 ROAS on a 60% margin is a POAS of 2.4. Every product, every campaign, every day.

You don’t need a dashboard for that. You need to know your margin, and you need a target ROAS set against it. Spend the subscription on something else.

Different margins? Now you’ve got a problem.

Two campaigns, both at 4 ROAS, both spending £1,000:

Say you’re a retailer. Some branded trainers on 30%. Your own label on 80%. Accessories somewhere in between.

Google sees two campaigns hitting a ROAS of 4 and thinks they’re doing the same job. They’re not even close.

One of them is barely covering itself. The other’s paying the bills. And if they’re sharing one budget and one target, Google’s quite happy to keep feeding money to the wrong one.

That’s when you need to see profit by product. A tool is one way. Splitting the campaigns by margin, each with its own target, is another.

Google can do some of it for you.

Fair play to Google here. If you add cost of goods sold to your products in Merchant Center and send basket data with your conversions, Google Ads will report estimated gross profit.

Google’s own help page says the cost figure is for reporting and doesn’t need to be exact. An average does the job.

So before you pay for something extra, check whether you can get the number from the account you’ve already got.

What I’d do.

Find out your margins first. Product by product if they vary. Most of the time, that one question tells you whether you need any of this.

If they’re all the same, I won’t tell you to buy a POAS tool. You don’t need one.

If they’re all over the place, I’ll want to see profit by product before I touch a single bid. Otherwise I’m guessing, and I’d rather not guess with your money.