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What is ROI?

ROI means Return on Investment. It is a term much used in online advertising to describe the relation between the cost of advertising campaigns and the profit generated by conversions, such as sales or leads. The ROI indicates the value gained by your company in relation to the cost of a campaign.

There is no means to obtain an accurate measurement of ROI, but to evaluate a campaign we subtract the expenditure on advertising from the value of the revenue originated from sales and divide the result by the total advertising costs. Therefore, the formula for calculating ROI is the following: (Profit of Investment – Investment Cost) / Investment Cost.