How to calculate ROI
ROI = (profit from the investment − cost of the investment) ÷ cost of the investment × 100
If a campaign costs 20,000 kr and brings in sales with a gross profit of 50,000 kr, the ROI is (50,000 − 20,000) ÷ 20,000 × 100 = 150%.
ROI vs ROAS
Return on ad spend (ROAS) divides revenue by ad cost and ignores other costs and margins. ROI uses profit and all the costs involved, so it shows whether marketing actually makes money. A campaign with a ROAS of 3 can still have a negative ROI if margins are thin.
Measuring marketing ROI
- Track conversions and revenue per channel with analytics and conversion tracking.
- Include all the costs: ad spend, agency fees, tools and staff time.
- Use profit rather than revenue, and consider customer lifetime value for repeat business.
- Give channels such as SEO and content enough time: they cost money up front and pay back over months or years.
Estimate the return on an ad budget with our free Ads ROI calculator.
ROI example: comparing two channels
| SEO content | Paid search | |
|---|---|---|
| Cost | 40,000 kr | 40,000 kr |
| Gross profit from sales | 100,000 kr | 70,000 kr |
| ROI | (100,000 − 40,000) ÷ 40,000 = 150% | (70,000 − 40,000) ÷ 40,000 = 75% |
The figures are illustrative. SEO benefits often continue after the cost has been paid, while paid search stops when the budget stops, so compare over a long enough period.
How to measure marketing ROI properly
- Include all costs: ad spend, tools, agency fees and staff time.
- Use profit, not revenue.
- Attribute sales to the right channels with tracking and your CRM.
- Use a time frame that fits the channel and the sales cycle.
- Compare with other options for the same money.
ROI mistakes
- Counting only the ad cost and not the staff time.
- Leaving out long-term effects of brand and content.
- Assuming ROI is the same as ROAS.
ROI FAQs
What is a good ROI?
Positive and better than your alternatives. See return on ad spend and customer lifetime value.
Can I calculate it quickly?
Yes, with our advertising ROI calculator. See also marketing analytics.