Break-even point
The sales volume at which total revenue equals total cost and profit is zero — fixed costs ÷ contribution margin per unit. The floor every campaign has to clear.
The break-even point is the level of sales at which revenue exactly covers cost and profit is zero. In units it is fixed costs ÷ contribution margin per unit; in marketing terms it is the volume — or the ROAS — a campaign must hit before it adds a cent of profit.
Why it matters for agencies
Break-even reframes targets in terms of profit rather than activity. Break-even ROAS is simply 1 ÷ gross margin: a 40% margin needs a 2.5× ROAS just to cover the goods. Setting break-even first stops a campaign that looks efficient on surface metrics from being run at a loss.
Run the numbers with the free break-even calculator.