Imagine you’ve got two acquisition channels.
Channel A (let’s say, TikTok ads, as an example) has a ROAS of 8.
Channel B (let’s say, Meta ads) has a ROAS of 3.
Which gets the extra budget?
On that information alone, probably TikTok.
Now imagine that six months later, customers who bought through Meta have spent twice as much as customers who bought through TikTok.
They have a much higher repeat rate, they buy more full-price product, and their return rate is substantially lower.
Now which channel would you choose?
A channel doesn’t simply generate revenue; it brings in customers. And those customers can behave very differently after the first purchase.
It doesn’t mean ROAS isn’t useful. Of course it is. It’s just that it’s only one part of the picture.
If I were deciding where to put the next chunk of acquisition budget, I’d want to understand both what a channel generates today, and also what types of customers it brings in in the mid-long term.
Sometimes those two questions give you the same answer; sometimes they really don’t.
