ROI(Return On Investment)




ROI (Return On Investment)

ROI is an abbreviation for return on investment, which is the ratio of the effect (profit) that a company obtains to the cost (investment) spent on advertising etc.
In the field of advertising effectiveness measurement, it is especially used as an effectiveness indicator to measure how much effectiveness (profit) the cost (expenses) spent on advertising actually leads to. Web analysts may not be able to grasp the cost, so they may use only advertising costs as expenses for convenience.
ROI is calculated using the following formula.

ROI (%) = profit ÷ cost × 100
= (Sales – Expenses) ÷ Expenses x 100

If costs exceed benefits, ROI is negative. By looking at ROI, you can see the contribution of profit to advertising investment for each measure. This is a useful indicator for determining measures that will further contribute to profits.

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