€25.27 – €27.97
1. Define the Inputs for ROI Calculation
- Investment (Cost of the Campaign):
- Total marketing spend (advertising, design, promotional materials, and staff) = $200,000
- This represents the total cost associated with the marketing campaign.
- Revenue Generated from the Campaign:
- Incremental revenue directly attributed to the campaign = $600,000
- This is the additional revenue generated as a result of the marketing efforts, based on sales performance tracking.
2. ROI Formula
The formula for calculating ROI is:
ROI=Net ProfitInvestment×100\text{ROI} = \frac{\text{Net Profit}}{\text{Investment}} \times 100
Where:
- Net Profit = Revenue Generated – Investment
- Investment = Total marketing spend
3. Calculate the Net Profit
Net Profit=$600,000−$200,000=$400,000\text{Net Profit} = \$600,000 – \$200,000 = \$400,000
4. Calculate the ROI
ROI=$400,000$200,000×100=200%\text{ROI} = \frac{\$400,000}{\$200,000} \times 100 = 200\%
5. Conclusion and Key Insights
- ROI: The ROI for this marketing campaign is 200%, meaning that for every dollar spent on the campaign, the company earned $2 in return.
- Interpretation: A 200% ROI indicates a highly successful campaign, generating significant returns relative to the cost. The company should consider scaling or replicating this marketing strategy in the future for other products or markets.