Title: Return on Investment (ROI) Author: Kriko Published: Aug 20, 2021 Last modified: Jul 11, 2026 --- 1. [Home](https://kriko.io/) / 2. [Glossary](https://kriko.io/glossary) / 3. R Letter # Return on Investment **(ROI)** **Return on Investment**, commonly abbreviated as ROI, is a performance metric used to measure how much return is generated compared to the cost of an investment. It helps evaluate the efficiency and profitability of a business decision, campaign or project. For this reason, businesses, brands and investors use ROI to compare different investments and understand which activities create stronger financial value. ROI is not used only in digital marketing. It can be applied in manufacturing, finance, real estate, technology, advertising, human resources, operations and many other areas where investment decisions are made. In digital marketing, ROI is often used to understand whether campaign budgets generate meaningful returns. However, ROI should consider not only the revenue generated but also the total costs required to produce that revenue. ROI helps businesses identify which investments are more efficient. Campaigns that perform below expectations may require lower budgets, revised targeting, new creative assets or different bidding strategies. Campaigns with stronger returns may receive more resources. In this sense, ROI is not only a metric for measuring past performance but also a decision-support indicator for future planning. The general ROI formula is: **(Gain from Investment – Cost of Investment) / Cost of Investment**. The result is usually expressed as a percentage. For example, if an investment costs 10,000 TL and generates 15,000 TL in value, ROI is calculated as (15,000 – 10,000) / 10,000. In this case, the ROI is 0.5, or 50%. In digital advertising campaigns, ROI should include advertising spend, product cost, operational costs, commissions and other relevant expenses. For example, if a Google Ads campaign generates 770 TL in sales revenue, this figure alone is not enough to evaluate ROI. If the product cost is 350 TL and the ad spend is 100 TL, the total cost is 450 TL. In that case, ROI is calculated as (770 – 450) / 450, which equals approximately 71%. ROI should not be confused with ROAS. **ROAS** measures how much revenue is generated for each unit of advertising spend, while ROI measures profitability by considering all investment-related costs. For example, if 100 TL in ad spend generates 770 TL in revenue, the ROAS is 7.7. However, once product cost and other expenses are included, the actual return on investment may be different. Actions such as purchases, sign-ups, subscriptions, form submissions or website visits can support ROI analysis, but their financial value should be defined. Knowing the number of website visits alone is not enough to calculate ROI. Their contribution to sales, lead value or long-term customer value should also be measured. When interpreted correctly, the **ROI metric** helps businesses manage budgets more efficiently and focus on more profitable investments. ## Discover it in the dictionary ### Dropshipping Dropshipping is a sales and order fulfilment model in which an e-commerce business sells products without keeping them in its own warehouse and instead… ### Churn Rate Churn Rate is an important customer metric that shows the percentage of customers a business loses within a specific period. It is calculated based… ### SEO-Friendly Content SEO-friendly content refers to website content prepared in a way that aligns with both user search intent and search engine evaluation criteria. SEO stands… ### Meta Title Meta title is a commonly used SEO term that refers to the title of a web page as it appears in search engine results.… ### Click Through Rate (CTR) Click Through Rate, commonly abbreviated as CTR, is a digital marketing metric that shows the percentage of users who click an ad or link… ### Bot (Crawler) A bot generally refers to software that performs specific tasks automatically on the internet. In the context of SEO, a crawler, web crawler, spider,… ### Call to Action A Call to Action, commonly abbreviated as CTA, is a message, button, link or directional element used to guide users toward a specific action.… ### Omnichannel Marketing Omnichannel marketing is a marketing approach that aims to provide customers with a consistent, seamless and connected experience regardless of which channel they use… ### Deep Linking Deep linking is a link structure that directs users to a specific piece of content, product, category, campaign or app screen instead of sending… ## Track the digital heartbeat with Kriko Subscribe to receive curated insights, news, and ideas shaping the digital landscape. By checking this box, you acknowledge and accept our [privacy policy](https://kriko.io/privacy-policy).