Industry benchmarks for Luxury Goods
Break-even ROAS for luxury goods is roughly 1.7x, since gross margin on the category commonly runs 55-70% before marketing. Prospecting CPMs are the highest in consumer retail at $25-55, driven by narrow affluent audiences and heavy brand competition. Conversion is correspondingly low at 0.5-1.4%, with consideration windows of 14-45 days and 6-12 touchpoints before purchase. Returns run high at 18-30%, since fit, finish, and authenticity expectations are unforgiving. The category average achieved ROAS is about 2.6x.
Attribution window, not margin, is the number that misleads luxury advertisers most. On a 30-day consideration cycle, a 7-day click window will under-report revenue by 25-40% and cause you to shut off campaigns that are actually clearing break-even. The real margin lever is return rate: cutting 26% returns to 18% through detailed measurement pages, video-on-hand product footage, and white-glove pre-purchase chat is worth more than any CPM optimization. Free two-way shipping is a $30-45 per return liability, so price it into your break-even rather than treating it as a service cost.
Frequently asked questions
Break-Even ROAS Calculator for Luxury Goods, answered.
What is a good ROAS for luxury goods?
Above 1.7x breaks even at typical 60-65% gross margin, and the category average achieved ROAS is about 2.6x.
Why do luxury campaigns look worse than they are?
Consideration cycles of 14-45 days mean short attribution windows miss 25-40% of revenue. Use a 28-day click window or holdout testing.
How much do returns affect luxury break-even ROAS?
A lot. A 26% return rate with two-way shipping raises break-even ROAS by roughly 0.5x versus an 18% rate.