Target ROAS, or tROAS, is a Smart Bidding target (Google sets the bid in each auction using predicted conversion data) expressed as return. Set 400% and Google aims to average $4 of conversion value for every $1 spent. It bids higher on auctions it expects to be valuable and lower on the rest. Let's take a shoe workshop in Mexico as an example. They make leather shoes and sell them online to Mexico and the United States. The shoe workshop uses a 400% Target ROAS on Shopping so a $180 oxford is treated as worth about $45 in ads.

When should you use tROAS instead of tCPA?

Use tROAS (Target ROAS: the return on ad spend you want) when conversions are worth different amounts, which is most ecommerce. Use Target CPA (tCPA: the average cost per conversion you set) when every conversion is worth about the same, which is most lead generation. tROAS requires that you pass accurate conversion values.

Glossary

Target ROAS

Target ROAS, also called tROAS, is a Google Ads setting where you tell Google the return you want, and Google tries to hit that average. ROAS stands for return on ad spend: how much sales the ads tool says came back compared with what you spent. If you set Target ROAS to 4, you are asking Google to aim for $4 of those claimed sales for every $1 of ads. It aims at sales, not at a flat cost per sale.

Theodor Lindfors, Founding Marketer · September 1, 2026

Formula

Target ROAS = the conversion value per ad spend you set for Google to bid toward

How Target ROAS works

You give a target as a percentage, and Google predicts the value of each auction. High-value predictions get aggressive bids, low-value ones get pulled back, and the campaign averages toward your ROAS number (return on ad spend: credited revenue divided by ad spend).

Target ROAS only works if conversion values reach Google correctly. Wrong or missing values mean the model optimizes toward a fiction.

Let's take a shoe workshop in Mexico as an example. They make leather shoes and sell them online to Mexico and the United States. The shoe workshop advertises on Google Shopping and Performance Max (PMax: a single campaign that serves across Search, Shopping, YouTube, Display, and more). An oxford with product code OXFORD-TAN is $180. A boot is $240. Those orders should not attract the same bid. Target ROAS (tROAS) is how the shoe workshop tells Google to chase value, not an equal cost per order.

Why Target ROAS matters

Target ROAS (tROAS) aligns bidding with margin rather than volume. Two orders at very different basket sizes should not attract the same bid, and tROAS is how you say that.

Target ROAS is also the default control on Performance Max (PMax) and Shopping, so for retailers it is often the main lever left.

How to read Target ROAS performance

Expect a trade between target and volume. Raising the Target ROAS usually raises efficiency and cuts spend. Lowering it usually buys volume at a thinner return. Choose the point that fits the profit goal, not the prettiest number.

Let's take a shoe workshop in Mexico as an example. They make leather shoes and sell them online to Mexico and the United States. The shoe workshop spends $15,000. Google credits $60,000 in sales. $60,000 of credited sales divided by $15,000 of spend is 4, which is 400%. A $180 oxford (product code OXFORD-TAN) can support about $45 of ads at that return ($180 divided by 4). The shoe workshop raises the target to 600% because the dashboard looked greedy. Spend falls to $8,000. Credited sales fall to $48,000. Return looks better (6x: $48,000 divided by $8,000). The shoe workshop also sold fewer pairs. If the extra $12,000 in sales at 400% ($60,000 minus $48,000) was still profitable after product cost, the prettier target cost them volume they wanted.

Check where the value comes from. If most of it is repeat customers or brand traffic, a strong Target ROAS can coexist with flat new-customer growth.

Common Target ROAS mistakes

Sending revenue with tax and shipping included, so the target is measured on the wrong value.
Setting an ambitious target on a new campaign with no value history.
Chasing a higher target while total profit falls with the volume.

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