Roi Calculator
Return on Investment (ROI) is the single most important metric for evaluating whether a marketing campaign, a piece of equipment, an employee hire, or any other business expense was worth it. Our ROI calculator handles the standard formula (gain ÷ investment) plus annualized ROI for multi-year investments, so you can compare a 2-year project against a 5-year one on equal footing.
What Is a Good ROI for a Small Business?
A "good" ROI varies by industry, risk level, and time horizon. For context, the S&P 500 returns roughly 10% annually over the long run. Small business owners typically expect significantly higher returns — often 15%–30% — to compensate for the additional risk and effort involved.
For marketing investments specifically, a 5:1 revenue-to-spend ratio (ROAS of 5x, or 400% ROI) is often cited as the benchmark for a strong campaign. Google Ads campaigns that perform well typically hit 200%–800% ROI depending on the industry.
How to Track Marketing ROI
Use UTM parameters and conversion tracking
Tag every campaign URL with UTM parameters and set up goals in Google Analytics to tie revenue back to specific campaigns, channels, and ads.
Track customer lifetime value, not just first purchase
A campaign that breaks even on the first sale may be highly profitable when you factor in repeat purchases and referrals over time.
Attribute revenue across multiple touchpoints
Most customers interact with multiple channels before converting. Use multi-touch attribution models to understand which channels are driving the most value.
About the ROI Calculator
Return on Investment (ROI) is the single most important metric for evaluating whether a marketing campaign, a piece of equipment, an employee hire, or any other business expense was worth it. Our ROI calculator handles the standard formula (gain ÷ investment) plus annualized ROI for multi-year investments, so you can compare a 2-year project against a 5-year one on equal footing.
How to use it
- Enter the initial investment cost.
- Enter the final value or total revenue generated.
- Optionally enter the time period in years for annualized ROI.
- See the absolute return, percentage ROI, and annualized rate.
Formula & methodology
ROI % = ((Final value − Initial investment) ÷ Initial investment) × 100. Annualized ROI = (1 + ROI/100)^(1/years) − 1.
Common use cases
- Measuring marketing campaign performance
- Evaluating equipment purchases or software subscriptions
- Comparing investment opportunities (stocks vs real estate vs business)
- Justifying a new hire to your CFO with hard numbers
- Setting performance benchmarks for paid ads
Frequently asked questions
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