How do you calculate ROI?

ROI (Return on Investment) is calculated using the formula: ROI = (Net Profit ÷ Cost of Investment) × 100%. Net Profit is calculated as (Gain from Investment - Cost of Investment). For example, if you invest $1,000 and earn $1,500: ($1,500 - $1,000) ÷ $1,000 × 100% = 50% ROI.

What's the difference between ROI and ROAS?

ROI (Return on Investment) measures net profit percentage after all costs, while ROAS (Return on Ad Spend) measures gross revenue generated per advertising dollar. ROAS = Revenue ÷ Ad Spend. ROAS is simpler but doesn't account for profit margins, while ROI provides a complete profitability picture including all expenses.

Should ROI calculations include time?

For longer-term investments, yes. Annualized ROI accounts for time: Annualized ROI = [(1+ROI)^(1/n) - 1] × 100%, where n is number of years. This allows comparison of investments with different timeframes. Our calculator can handle both simple ROI (ignoring time) and annualized ROI for multi-year investments.

What costs should be included in ROI calculations?

Include all direct and indirect costs: purchase price, installation/setup fees, training costs, maintenance expenses, staff time, overhead allocation, and any other expenses directly tied to the investment. For marketing campaigns, include creative costs, platform fees, agency fees, and staff time—not just media spend.

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Return on Investment (ROI) Calculator

Wondering how profitable your recent investment was? Use our simple ROI Calculator to determine your Return on Investment in seconds. Whether you're in digital marketing, real estate, or eCommerce, understanding ROI helps guide better business decisions.

Why ROI Matters

Helps measure marketing campaign success
Makes investment comparisons easy
Tracks business profitability over time
Essential for budgeting and forecasting

ROI Formula

ROI = (Net Profit / Investment Cost) x 100

Where:

Net Profit = Total Revenue - Investment Cost
Result is expressed as a percentage

❓ Frequently Asked Questions (FAQs):

What is a good ROI percentage?

A good ROI varies by industry, but in general, anything above 15–20% is considered profitable.

How can I improve my ROI?

Focus on reducing costs, increasing revenue, and optimizing your processes and campaigns.

Is ROI the same as profit margin?

No. ROI measures the return compared to the cost of investment, while profit margin shows how much profit you keep from sales.

About Our Marketing Tools

SUC

Digital Marketing Team at Smart Unit Calculator

Our team of marketing analysts and strategy specialists develops these essential calculation tools for digital marketers, PPC managers, SEO experts, content strategists, and business analysts who need to interpret campaign data across platforms.

Campaign-Level Accuracy

All marketing conversions use industry-standard formulas for reliable metrics like CTR, CPC, CPM, ROAS, and CAC that drive data-driven decisions.

Cross-Platform Metrics

Designed to standardize and compare key performance indicators across Google, Facebook, Instagram, LinkedIn, Twitter, and YouTube advertising.

CTR ↔ Clicks

CPC ↔ CPM

ROAS ↔ ROI

CAC ↔ LTV

Data-Driven Marketing Insights

These tools are developed using industry-standard marketing formulas and analytics methodologies to provide accurate, actionable insights for optimizing ad spend and campaign performance.

Marketing Performance Disclaimer

These digital marketing calculators are for informational, planning, and analytical purposes. Results are estimates based on standard formulas and should be used as directional guides. Campaign performance can vary based on market conditions, creative, targeting, and other variables.

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