For example, if one campaign generates a 15% ROI while another generates a 50% ROI, which one will you invest your marketing budget in next?
And if its entire marketing budget returns 6% and the stock market ios database returns 12%, the company could make more profit by investing in the stock market.
Let's move on to another marketing-oriented example:
If a $1,000 investment in advertising results in $2,500 in sales on your website, this would be your ROI formula:
(2500-1000) / 1000 = 1.5
That is, you would be getting 150% of your advertising investment.
This value is ideal for calculating the effectiveness of a campaign. However, the campaign's actual ROI must also be calculated considering the operational costs required to generate that revenue.
For example, if the cost of distributing orders was $200, the ROI is:
(2500-200-1000) / 1000 = 1.3
Calculating ROI is essential for deciding on future investments.
With this data, you'll have the information you need to evaluate which projects are most profitable and, consequently, you'll have a better idea of what types of actions are best for you.Marketing-oriented examples
For example, if one campaign generates a 15% ROI while another generates a 50% ROI, which one will you invest your marketing budget in next?
And if its entire marketing budget returns 6% and the stock market returns 12%, the company could make more profit by investing in the stock market.
Let's move on to another marketing-oriented example:
If a $1,000 investment in advertising results in $2,500 in sales on your website, this would be your ROI formula:
(2500-1000) / 1000 = 1.5
That is, you would be getting 150% of your advertising investment.
This value is ideal for calculating the effectiveness of a campaign. However, the campaign's actual ROI must also be calculated considering the operational costs required to generate that revenue.
For example, if the cost of distributing orders was $200, the ROI is:
(2500-200-1000) / 1000 = 1.3
Calculating ROI is essential for deciding on future investments.
With this data, you'll have the information you need to evaluate which projects are most profitable and, consequently, you'll have a better idea of what types of actions are best for you.