Return on investment (ROI)

What is Return on Investment (ROI)?

Return on investment (ROI)= (Investment Revenue - Investment Cost)/ Investment Cost

Return on investment calculates the return on a particular venture or action and is recorded as a percentage. ROI can be used to calculate how effective a particular marketing campaign is (such as PPC, remarketing, social media).

Example

Company XYZ invested $2000 into a remarketing campaign. As a result of this campaign Company XYZ saw $2200 in revenues.

($2,200-$2000)/$2000 = 10%

Company XYZ's ROI for the remarketing campaign is 10%.