Comparing ROAS: In-House vs Paid Social Agency for Shopify
- Diana Dela Cruz
- Sep 16
- 4 min read
For Shopify brands, every dollar spent on advertising needs to generate measurable returns. That’s where ROAS - Return on Ad Spend - comes in. ROAS tells you how much revenue your ad campaigns generate for every dollar you invest.
But here’s the challenge: should Shopify brands manage paid ads in-house or outsource to a specialized paid social agency? Both approaches can deliver results, but the differences in cost, scalability, and expertise can dramatically impact ROAS.
This article compares in-house and agency-run advertising strategies for Shopify businesses, using real-world data to illustrate where brands can expect the highest returns.
Understanding ROAS in Shopify Paid Social
ROAS (Return on Ad Spend) is calculated as:
ROAS = Revenue from Ads ÷ Ad Spend
For example, if a Shopify brand spends $10,000 on Facebook and TikTok ads and generates $30,000 in sales, the ROAS is 3.0x.
Why ROAS matters for Shopify
Revenue validation: Proves ad spend efficiency.
Scaling readiness: Helps decide when campaigns can be scaled profitably.
Budget allocation: Identifies which channels perform best.
Key supporting metrics
Average Order Value (AOV): Higher AOV often means higher ROAS.
Customer Acquisition Cost (CAC): Directly impacts profitability.
Lifetime Value (LTV): Long-term return beyond immediate purchase.
Shopify ROAS Benchmarks: Industry reports suggest most Shopify stores aim for 2–4x ROAS depending on niche, product margins, and ad spend volume.
Running Ads In-House: Pros, Cons & ROAS
Pros of keeping ads in-house
Lower upfront costs: No agency retainer.
Full control: Messaging and creative aligned tightly with brand voice.
Brand familiarity: No onboarding needed to understand products.
Cons of in-house ad management
Steep learning curve: Platforms like Meta and TikTok evolve weekly.
Time drain: Managing ad accounts takes hours away from product growth.
Data limitations: In-house teams often lack access to aggregated benchmarks and complex media insights.
Risk of inefficiency: Without advanced optimization, ad spend waste increases.
Typical in-house ROAS
Shopify brands running ads internally often hover around 1.5x–2.0x ROAS, especially in the early growth phase. While sustainable for testing, it usually limits scaling beyond small budgets.
Partnering with a Paid Social Agency: Pros, Cons & ROAS
Pros of hiring an agency
Expertise at scale: Agencies run thousands of campaigns and know platform trends.
Advanced tools & testing: Proprietary frameworks and AI-driven optimizations.
Faster results: Agencies cut the trial-and-error phase.
Creative & data support: Agencies bring design, copy, and analytics together.
Cons of agency partnerships
Fees & retainers: Agencies add monthly costs.
Less direct control: Brands rely on external management.
Onboarding period: Initial weeks may focus on learning brand voice.
ROAS potential with agencies
Many Shopify-focused agencies consistently deliver 3.0x–5.0x ROAS once campaigns are optimized. Agencies not only improve efficiency but also scale budgets more confidently.
Cost Comparison: In-House vs Agency
While agencies charge fees, the improved efficiency and higher ROAS typically outweigh costs, especially for brands seeking rapid growth.
Scalability & Long-Term Growth
Scaling Shopify ads requires:
Consistent creative testing
Dynamic bid strategies
Accurate tracking & attribution
Ongoing platform updates
Agencies excel in these areas because they:
Run A/B tests at scale across multiple brands.
Apply benchmark insights not available to individual Shopify stores.
Balance CAC vs. LTV to ensure growth doesn’t come at the expense of profitability.
For brands planning to hit $1M+ in revenue, agencies often prove essential for sustained growth.
Key Decision Factors for Shopify Brands
Stay in-house if:
You’re under $5k/month in ad spend.
You want to learn platforms hands-on.
Your margins are thin and can’t support agency fees yet.
Hire an agency if:
You’re scaling beyond $10k/month in ad spend.
You want to maximize ROAS and reduce wasted spend.
You’re aiming for rapid scaling with proven strategies.
Conclusion
ROAS is the ultimate measure of paid advertising success for Shopify brands. While in-house management works in the early stages, most brands hit a ceiling without advanced expertise. Paid social agencies consistently unlock higher ROAS, scalable growth, and long-term profitability.
👉 If you’re serious about scaling your Shopify store, the next step is clear:
Book a Call with RCKSTR Media to explore paid social growth.
Download our Ad Scaling Guide for proven strategies to maximize ROAS.
FAQs
1. What’s a good ROAS benchmark for Shopify stores?
Most Shopify brands aim for 2–4x ROAS, though high-margin products may require less.
2. How much does a paid social agency cost?
Agencies typically charge a flat retainer, a percentage of ad spend or revenue, or a mix. While this adds cost, efficiency gains usually offset the investment.
3. Can small Shopify brands benefit from agencies?
Yes. Even smaller brands can benefit, but it’s most effective once monthly ad spend passes $10k-20k.
4. What’s the difference between ROAS and ROI?
ROAS measures ad efficiency only, while ROI accounts for all business costs.
5. How do agencies track Shopify sales attribution?
Agencies integrate tools like Meta’s CAPI and Google Analytics 4 for accurate attribution.
6. Can I start in-house and move to an agency later?
Absolutely. Many brands start small in-house, then partner with agencies once ready to scale.
7. What’s the fastest way to improve ROAS for a Shopify brand?
Optimizing creative testing, improving landing pages, and leveraging agency-level targeting strategies are proven methods.
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