What is a good Marketing ROI?

Most marketers aim for a 5:1 ratio (500%), meaning $5 in revenue for every $1 spent. A 10:1 ratio is exceptional, while 2:1 is often considered the break-even point when factoring in overhead.

How is ROI calculated?

The formula is: ((Revenue - Marketing Cost) / Marketing Cost) * 100. This gives you the percentage return on your ad spend.

Marketing ROI Calculator

Instantly measure the profitability of your campaigns. Determine if you're hitting the "golden ratio" of 5:1 and maximize your marketing budget.

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data_usage Campaign Data

Total Revenue ($)

Total sales generated from this campaign.

Marketing Cost ($)

Total ad spend + agency fees + creative costs.

ROI

--%

Profit

$--

What is Marketing ROI?

Marketing Return on Investment (ROI) is a metric used to evaluate the efficiency of a marketing campaign. It compares the revenue generated to the cost of that campaign.

The Formula

(Revenue - Marketing Cost)

Marketing Cost

× 100

Example: If you spend $100 and make $500:
(($500 - $100) / $100) * 100 = 400% ROI

ROI Benchmarks

5:1

Strong (500%)

The "Golden Ratio". Your marketing is highly effective.

2:1

Break-Even (100%)

Profitable on paper, but likely barely covering overhead/COGS.

1:1

Loss (0%)

You are losing money on every sale once COGS are added.

Who Needs This Tool?

campaign

Marketers

Justify ad spend to clients or bosses.

store

E-Commerce

Track ROAS (Return on Ad Spend) for products.

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Agencies

Reporting monthly performance to clients.

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Founders

Minimize burn rate and maximize growth.

Frequently Asked Questions

What is the difference between ROI and ROAS? expand_more

ROI (Return on Investment) looks at the overall profitability, often including all costs (agency fees, software, etc.).
ROAS (Return on Ad Spend) strictly measures the revenue generated from the specific ad budget.

ROI is for the business bottom line; ROAS is for optimizing specific ad channels.

Why is my ROI negative? expand_more

A negative ROI means you spent more on marketing than you earned in revenue. This is common in the early stages of a brand awareness campaign, but unsustainable long-term. You need to either increase your conversion rate, increase your pricing, or lower your cost per acquisition (CPA).

Does this include Cost of Goods Sold (COGS)? expand_more

This simple calculator focuses on Marketing ROI, comparing Revenue vs. Marketing Spend. To calculate Net Business ROI, you should subtract COGS from your Revenue before entering it, or use a more advanced "True Profit" calculator.