Ask the Collective

What are realistic ROAS targets and cost-per-acquisition benchmarks for D2C alcohol brands advertising on Meta?

ROAS targets vary significantly by business model and margin structure, but members report aiming for **3:1 revenue-to-ad-spend ratio** as a general industry benchmark. However, the drinks industry faces particular challenges due to duty costs (c. £9 on 40% ABV) and delivery fees (c. £5), which compress margins dramatically. **Key metrics and targets from the community:** - **5.5 ROAS target** — one established D2C operator (100,000+ Shopify orders achieved) sets this as their benchmark across all D2C channels (not just Meta, due to platform attribution unreliability). They pull back spend if ROAS falls below this threshold. - **50% minimum margin requirement** — members stressed this is the floor for sustainable D2C; without it, acquisition costs cannot be recovered profitably. - **First-order profitability as non-negotiable** — don't rely on customer lifetime value to subsidise acquisition, especially post-iOS privacy changes. One member reported £22 per purchase cost against a £46 average basket value (break-even on first order), relying on re-orders for profit. - **Customer lifetime value (LTV) focus** — D2C profitability depends on repeat purchases, not first-order ROAS alone. New releases, seasonal offers (e.g. Christmas), and strong creative assets improve Meta performance. - **Real-world example:** £10 ad spend on a £30 net sale leaves minimal margin after product costs, duty (£9), and delivery (£5). **Caveats:** Meta attribution is unreliable; measure ROAS across all D2C sales channels, not just platform-reported metrics. VAT must also be factored into margin calculations. Success on Meta is now limited to tactical moments (new releases, promotions, seasonal campaigns) rather than sustained performance.