ROI
Table of Contents
What is ROI in marketing?
Return on investment (ROI) measures net profit generated relative to the total cost of a marketing activity, expressed as a percentage.
Key points
- Formula: ((Revenue − Cost) ÷ Cost) × 100.
- Targets: 3-5× for paid media; 5-10× for organic initiatives.
- Time frame: Always align ROI window to sales cycle length.
- Attribution: Multi-touch models reveal full impact on revenue.
- Optimization: Scale high-ROI channels, pause negative-ROI spend.
Pro tips
- Include lifetime value (LTV) for recurring-revenue products.
- Track ROI by channel and campaign, not just aggregate.
- Re-forecast quarterly to account for seasonality.
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