After taking out the shipping costs, marketing costs (copywriters, designers, marketing tech), and customer support - it's likely the net profit on the sale is minimal or negative.
ROAS Problem #2: ROAS Only Takes into Account Ad Spend
Similarly, ROAS has no way of integrating expenses outside of direct ad costs.
This inflates the perceived profitability of every marketing campaign that uses ROAS as it's primary KPI. The reality is marketing campaigns cost much more than the distribution costs.
Costs include creative talent such as copywriting, videographers, and design - as well as regular technology expenses.
ROAS Problem #3: You Cannot Use ROAS On Anything That’s Not an Ad
Below is a short list of eCommerce marketing campaigns that cannot be measured with ROAS.
Onsite Personalization - Including cross-sales, upsells, and advanced product recommendations.
On-Site Messages- Including live chat, message bars, and welcome pop-up offers
Dynamic Content - Such as geographic discounts, shipping discounts, etc
Triggered Emails - From cart abandonment/browse campaigns to after-sale promotions
Segmentation Technology - That is capable of creating detailed cohort analysis
All of these marketing campaigns are impossible to measure using ROAS. It is impossible to use ROAS becuase they don't have a traditional "ad spend" metric needed to calculate a ROAS KPI.
When you combine this with the fact that marketing campaigns that are able to use ROAS have inflated success metrics, it gives you an inaccurate view of which campaigns are succeeding and which are failing.