marketing
New-Customer ROAS
ROAS calculated using only orders from first-time buyers, stripping out returning customers who inflate blended numbers.
Formula
New-Customer ROAS = Revenue from new customers / Ad Spend
Blended ROAS includes returning customers who often buy again regardless of whether your ad reached them. Crediting that sale to your ad flatters the numbers.
New-customer ROAS forces honesty: it only counts orders from customers who had never bought before. This is the true cost of acquiring a new buyer from paid channels.
New-customer ROAS is almost always lower than blended ROAS. That is not a problem - it is accurate. A brand with strong retention should expect blended ROAS to pull above new-customer ROAS, because the returning segment carries less ad cost per sale.
Related terms
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