Week 10

 

Marketing ROI (Return on Investment) is a metric used to evaluate the effectiveness and profitability of a marketing campaign or initiative. It measures the return or gain generated from the marketing investment relative to the cost of that investment. The formula to calculate Marketing ROI is as follows:

ROI = (Net Return from Marketing Investment / Cost of Marketing Investment) * 100

The result is expressed as a percentage. If the ROI is positive, it means the marketing effort has generated more revenue than the investment, indicating a profitable campaign. Conversely, if the ROI is negative, the campaign resulted in a net loss.

Calculating marketing ROI is crucial for businesses to determine the effectiveness of their marketing strategies and to allocate resources more efficiently in the future. It helps organizations make informed decisions about which marketing initiatives are delivering the best results and which ones might need improvement or reconsideration.