Profit bidding: optimise your ads to profit, not revenue
Profit bidding sets every product's bid from its true margin, so each sale you pay for makes you money.
Revenue alone doesn't pay the bills. Profit you can reinvest does.
Why revenue bidding quietly costs you
Most accounts set one average ROAS target for a whole group of products. It looks fine in the report.
- Thin-margin products overspend and can lose money on every sale
- Strong-margin products are held back from sales they could afford
- Returns, fees and shipping never make it into the bid
- The ROAS report is an average too, so nobody notices
Revenue hides the real cost of each sale. Bid on the margin each product actually has.
Five terms you'll need
- ROAS
- Return on ad spend: sales ÷ ad cost. £300 of sales from £100 of ads is 3.0.
- Target ROAS
- The ROAS you ask Google to aim for. Entered as a percentage: 3.0 is 300%.
- True margin
- What's left of the price without VAT after every cost of the sale.
- Breakeven ROAS
- The ROAS where a sale makes exactly £0. Below it, you lose money.
- Profit target
- The share of the selling price you want to keep after all costs, ads included.
Google Ads Help — About Target ROAS bidding (support.google.com/google-ads/answer/6268637), 2026
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