What is ROI in Digital Marketing and how to calculate it

If you want to have a solid brand in the online field, you must create and invest in digital marketing strategies. But, how do you know if that marketing strategy you have carried out is bringing you benefits or if on the contrary you are losing money with it?

What is ROI in marketing and how to calculate it CLICK TO TWEET
One of the 印度电话号码清单 metrics that you should take into account is ROI, since measuring it will tell you if your strategy is converting you effectively or not.

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ARTICLE INDEX
What is ROI in marketing and what is it for?
Difference between ROAS and ROI
Why is it so important to know what your ROI is?
What is the ROI formula?
ROI example in marketing
Online tools to calculate ROI
Types of ROI in Digital Marketing
ROI in Social Ads
ROI in Google Ads
ROI in Social Networks
ROI in Email Marketing
ROI in Influencer Marketing
ROI in SEO
ROI in Content Marketing
How to measure the ROI of a digital marketing campaign?
Tips to improve ROI
Know your target
Analyze the sales process
Define metrics and measure
Create a scorecard and have a contingency plan
What is ROI in marketing and what is it for?
The ROI (Return On Investment or Return on Investment) is a financial ratio that indicates the economic value generated by the marketing actions of a brand or company.

That is, it is the formula that allows us to know how much money we are generating with the different actions that we are carrying out in marketing and if the balance between expenses and income is positive (we earn money) or negative (we spend more money than we enter ).

Difference between ROAS and ROI
Being similar terms that talk about profitability, you may not know what the difference is between these two metrics.

The difference between the two is that the ROAS indicates the relationship between the 警报消息 profits obtained from online sales, taking into account exclusively the investment in advertising campaigns . The ROI establishes the relationship between the profits obtained and the total investment made to obtain them, including investment in advertising campaigns and any other type of investment.

Why is it so important to know what your ROI is?
When you are implementing a marketing strategy, you need to know whether or not it is working profitably, in order to make the right decisions without negatively affecting the results of your company or project. And, for this, you have to measure.

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Measuring ROI will allow you to:
Analyze which are the actions that are being more profitable for you and which are the least
Monitor if your marketing strategy is working or you need to make adjustments
Know the result of marketing actions in the company’s income statement
Know what the profitability of a specific action or a business area is

What is the ROI formula?
The ROI formula is very simple and you only need to have a calculator at hand and know the income that has been generated and the money that has been invested for it:


ROI example in marketing
To calculate ROI in marketing, you only have to take into account the benefits and investment that has been made in this area of ​​the business .

For example, if you hire a Facebook and Instagram Ads campaign, you should take into account:

The investment you are going to spend on the campaigns
The price it costs you to hire a digital Trafficker or Facebook Ads specialist
The result that the campaign has generated
If you have invested € 1,000, the specialist you have hired charges € 450 for campaign management and you have obtained a profit of € 15,000, the ROI would be:

ROI = (((10,000 – (1,000 + 450)) / (1,000 + 450) = 489.66%

That is, for every euro you have invested, you have received € 4.89

Online tools to calculate ROI
If you want to use online tools in which you simply have to enter the data and have the calculation performed automatically. Here are some that you can use:

Calkoo
It is a very simple tool in which you only have to enter the value of the benefits and that of the investment and it directly gives you the result of your ROI.

Calcuworld
It is a more complete tool in which you can add the cost of the campaign, visitors generated, leads generated, sales generated and gross profit per sale to calculate your ROI.

Socialancer
It is a more advanced tool in which you can enter costs for human resources, technology, web design and creatives , content, attracting new customers, reducing costs, improving the brand image, etc. to give you a more advanced ROI.

Types of ROI in Digital Marketing
There are different types of ROI in marketing, depending on the communication channel used by the brand or company. Let’s see what you should take into account to calculate the ROI of each channel.

ROI in Social Ads
If you invest in Facebook and Instagram Ads , Twitter Ads or LinkedIn Ads, you can obtain the ROI of your campaigns to know if what you are investing is really being profitable or not. To do this, keep in mind:

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The investment you make in advertising campaigns.
The cost of carrying out these advertising campaigns (what your employee or the Digital Trafficker you have hired costs you, what it costs you to create the ad designs, etc.).
The conversions you have obtained (leads, sales, traffic to your website, etc.).
If the ROI is negative, it is best to turn off campaigns and redesign a new strategy to prevent you from losing money.

ROI in Google Ads
If you bet on Google Ads advertising campaigns, you should know if the campaigns are being profitable or you are losing money. To do this, you must take into account:

The investment you make in advertising campaigns.
The cost of carrying out the advertising campaigns (your employee’s salary or what the Trafficker specialist in Google Ads charges, what it costs you to create the designs of the displayed ads, etc.)
The income that has been obtained thanks to the campaigns.
If ROI is less than 0, review your ad strategy and campaign settings.

ROI in Social Networks
To know if the strategy you carry out on social networks is working properly, you can calculate the ROI. You should take into account:

The investment you make in having a presence in social networks (what your employee or the specialist you have hired to manage them costs you, if you hire a photographer to take the images that you will publish on social networks, etc.)
The conversions that are made through your social networks (leads, web traffic, purchases, etc.)
You should know that on many occasions, social networks will help you to have a good brand reputation (branding), something that is difficult to estimate as it does not produce direct economic benefit.

ROI in Email Marketing
Email marketing is a channel with a high conversion and obtains high ROI percentages , so if you are not using this strategy to target your potential clients, you are missing a great opportunity.

When it comes to knowing the ROI of your email marketing strategy, you need to know:

The investment you make in your email marketing campaigns (email marketing tool, the cost of your employee or the email marketing specialist, etc.).
The cost of your strategy to obtain leads or to create the lead magnet that subscribers will receive for leaving their data.
The sales that your email marketing campaigns report to you.
ROI in Influencer Marketing
The campaigns influencers or micro-influencers are used by brands or companies that want to publicize their products or services to a targeted audience (the public who follows the influencer). If you are doing this type of campaign, you must analyze whether it is being profitable or not.

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To do this, you must take into account:

The cost of hiring the influencer.
The products or materials that were needed to create the campaign.
The income that has been generated thanks to the campaign (to analyze it, you will need to have a code for the influencer, which he will share with his followers to enter it in the purchase, or generate a specific URL for the influencer)
ROI in SEO
If you have a website or blog, you must work on your web positioning to have visibility and appear in the results when a user searches for your products or services.

To know if your investment in positioning your website is being profitable, you must take into account:

The expenses of hiring an SEO consultant to work on the positioning (if you have to pay for SEO audits, study of keywords, improvements to the website, a copywriting specialist to create the texts for the website, etc.).
The organic visits that appear in Google Analytics and the objectives that are met (they have bought, they have subscribed, etc.).
Web positioning is not something that has an immediate return, but we must work on it today so that tomorrow we are well positioned, so you must bear in mind that it will surely be profitable in the medium-long term, not in the short term.

ROI in Content Marketing
Content marketing is a strategy that will allow you to position yourself as an expert in your sector, sharing your knowledge through a blog and reaching users who are looking for a solution to their problem, without being intrusive.

Although it is a long-term strategy, so you will not obtain profitable results in the short term, you can analyze its ROI. To do this, you must take into account:

What your employee or a specialist who is responsible for creating the content costs you (or the time you spend on it if you do it yourself)
What it costs you to promote that content so that users see it
The number of visits your content gets and if the visits are of quality (average duration of the visit and bounce rate in Google Analytics)
If the content has a download or a link to your services or products, analyze whether or not it is converting you (leads and sales).
How to measure the ROI of a digital marketing campaign?
To calculate the ROI of a digital marketing campaign, the following metrics must be taken into account: