What is Return on Investment (ROI)?
Return on investment (ROI)= (Investment Revenue – Investment Cost)/ Investment Cost
Return on investment calculates the return of 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).
Company XYZ invested $2000 into a remarketing campaign. As a result of this campaign Company XYZ saw $2200 of revenues.
($2,200-$2000)/$2000 = 10%
Company XYZ’s ROI for the remarketing campaign is 10%.