What is Marginal ROAS/ CPA?
Marginal ROAS (Return on Ad Spend) and Marginal CPA (Cost per Acquisition) look at the next euro you’re about to spend instead of the euros you’ve already spent. Where traditional ROAS and CPA tell you how your campaigns performed so far, marginal metrics answer a more forward-looking question:
“If I spend one more euro on this campaign, what return or cost can I expect?”
For Marginal ROAS, higher = better.
For Marginal CPA, lower = better.
ROAS/ CPA vs. Marginal ROAS/ CPA
| Average ROAS/ CPA | Marginal ROAS/ CPA |
Looks at... | All euros spent so far | The next euro you’ll spend |
Helps with... | Performance review | Smart budget allocation |
Managing diminishing returns
Every campaign hits a point of diminishing returns: where spending more yields less return.
Here’s how that typically looks for ROAS:
🔴 Low spend zone: Each euro earns high returns (e.g., €14.22 per €1)
🟢 Medium spend: Returns are still good, but lower (e.g., €5.78 per €1)
🟡 High spend: Each extra euro barely adds value (e.g., €2.35 per €1)
And for CPA:
🔴 Low spend: Low CPA's (great efficiency)
🟢 Medium spend: CPA increases slightly
🟡 High spend: CPA climbs steeply: each extra euro costs more to convert
Even if your average performance looks good, continuing to invest where marginal ROAS is low or marginal CPA is high can waste budget.
Plot example below to see the relationship between ROAS and Marginal ROAS:
Where to set Marginal ROAS/ CPA in the automation form
Inside the Automation form, there is an option to select the Optimization type of the Automation, here you can select Marginal ROAS / CPA. (depending on the selected goal metric)
How our automation uses Marginal ROAS and CPA
You can now set a Marginal ROAS or Marginal CPA threshold in your automation. The system will:
Increase spend on campaigns where the next euro is expected to outperform your threshold
Reduce spend where performance falls below your target
Reallocate budget to higher-performing opportunities
Why It Works
Prevents overspending in low-performing campaigns
Helps scale up high-performing campaigns faster
Maximizes efficiency of every euro spent
Setting a Marginal ROAS or CPA Threshold
When you set a threshold (e.g. Marginal ROAS = 3.0 or Marginal CPA = €10), remember:
Your average ROAS will typically end up higher, and your average CPA lower.
The system stops investing before the exact threshold is hit.
Early, efficient spend skews results favorably.
This gap between marginal and average is expected and beneficial.
Best Practices for Getting Started
Start conservatively
We suggest beginning with a lower threshold (e.g. 1.0 – 2.0 ROAS or a slightly above-average CPA) to reduce risk, a high threshold may lead to a decrease in budget, as the Automation will recommend to decrease spending.Monitor performance closely
Watch which campaigns are scaled up or down and how results evolve.Adjust gradually
You can raise the threshold daily based on your confidence and performance data.Allow for conversion lag
Give the system time to learn and adapt to your unique campaign dynamics.Disable 'Sync Total Daily Budget with Ad Managers'
How It Interacts with Other Rules
Marginal ROAS and CPA automations work in harmony with your other existing settings:
Maximum daily budgets remain intact.
Other automation rules can still run, but we recommend avoiding heavy manual interference at the campaign or ad set level.
Overall ROAS/ CPA monitoring continues to guide your broader strategy.
Summary
Marginal ROAS and CPA bring a smarter, more agile way to allocate your ad budget. Instead of just reviewing past performance, you can now optimize based on future potential. By focusing on where your next euro will deliver the best return, or lowest cost, you avoid waste and accelerate growth in your most efficient campaigns.
Remember: Even a great-performing campaign might not deserve more budget if their marginal efficiency has dropped.
Need help getting started or choosing the right threshold? Reach out to your Customer Success Manager or support@billygrace.com.