Return and profitability
Marketing ROI Calculator
Calculate net return on marketing cost — and see why ROI and ROAS give different answers about the same campaign.
Quick answer: ROI = ((revenue − marketing cost) ÷ marketing cost) × 100. $50,000 of revenue from $12,500 of marketing cost is a 300% ROI.
Calculate marketing ROI
Enter total revenue attributed to marketing and the total cost of that marketing.
Result
Enter revenue and marketing cost to calculate ROI.
How to calculate marketing ROI
| Revenue | Marketing cost | Calculation | ROI |
|---|---|---|---|
| $50,000 | $12,500 | (($50,000 − $12,500) ÷ $12,500) × 100 | 300% |
| $18,000 | $9,000 | (($18,000 − $9,000) ÷ $9,000) × 100 | 100% |
| $8,000 | $10,000 | (($8,000 − $10,000) ÷ $10,000) × 100 | −20% |
A positive ROI means marketing returned more than it cost. Zero means break-even. Negative means it cost more than it produced — which is a legitimate result for a first-quarter brand-building investment, provided you know that is what you are doing.
ROI vs ROAS
These two are constantly confused, and the difference matters when you set targets:
| Metric | Formula | Answers | Same campaign |
|---|---|---|---|
| ROAS | revenue ÷ ad spend | Revenue per dollar of media spend | 4.00x |
| ROI | ((revenue − total cost) ÷ total cost) × 100 | Profit per dollar of everything you spent | depends on cost basis |
Worked example: $12,000 of revenue from $3,000 of ad spend is a 4.00x ROAS. If the goods cost $4,800 and you also spent $1,000 on creative and tools, total cost is $8,800 against $12,000 of revenue — profit of $3,200, or a 36% ROI. Same campaign, two very different-looking numbers.
Which cost basis should ROI use?
- Media only gives a number close to ROAS and is useful for comparing channels.
- Media + creative + tools + agency fees is the honest marketing ROI, and the number a finance team will ask for.
- All costs including product and fulfilment is the business ROI. It is the only version that tells you whether the company made money.
Whichever you choose, state it. "ROI is 36%" is meaningless without the cost basis and the period.
What to include on each side
| Revenue side | Cost side |
|---|---|
| Attributed sales, net of returns and refunds | Media spend on every platform |
| Lead value for non-transactional campaigns | Creative production and photography |
| Subscription revenue recognised in the period | Tools, analytics and agency or freelance fees |
| Repeat purchases from customers acquired in the period | Discounts and promotional margin given away |
Two adjustments change the answer most: returns (for apparel and other high-return categories, net revenue can be 20–30% below gross) and repeat purchases (a first-order ROI can look terrible while the cohort is profitable over 12 months). Decide which question you are answering before you calculate.
Using ROI to make decisions
- Set a floor. Decide the minimum ROI you will accept for growth spending, and treat anything below it as a test with a time limit.
- Compare channels on the same basis. Same period, same revenue definition, same cost inclusions.
- Check ROI next to ROAS. A high ROAS with a low ROI means costs outside media are eating the margin.
- Look at cohorts, not single months. Repeat purchase changes ROI dramatically over 6–12 months, especially for subscription and consumable products.
Frequently asked questions
How do I calculate marketing ROI?
Subtract total marketing cost from the revenue it produced, divide by the marketing cost, then multiply by 100. $50,000 of revenue from $12,500 of cost is a 300% ROI.
What is a good marketing ROI?
There is no universal number, but a common working target is a 5:1 ratio of revenue to cost, which is a 400% ROI. Service businesses with high margins can accept lower; low-margin retail needs higher.
Is ROI the same as ROAS?
No. ROAS compares revenue with ad spend only. ROI compares profit with all costs you include. A campaign can show a 4.00x ROAS and a modest ROI once product cost, creative and tools are added.
Can marketing ROI be negative?
Yes, and it often is in the first period of a brand campaign or a new channel test. What matters is whether the ROI is improving and whether you set a limit on how long you will fund a negative return.
Should ROI include product cost?
For a business-level answer, yes — otherwise you are measuring media efficiency, not profit. State your cost basis either way so the number can be compared.
How often should I calculate marketing ROI?
Monthly for budget control and quarterly for channel decisions. Short windows are noisy, especially for lead generation where deals close weeks after the click.
Does this calculator work for lead generation?
Yes. Use the revenue value of a lead rather than a sale: leads × lead-to-customer rate × customer value gives the revenue figure to enter.