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# ROMI Calculator (Return on Marketing Investment)

LAST UPDATE: September 24th, 2020

## Definition – What is Return on Marketing Investment?

ROMI is a measurement of the effectiveness of a marketing campaign.

It takes a baseline level of business activity and measures it against the business activity from a time when a marketing campaign is running.

The final return is the extra profit above regular business activity less the cost of running the marketing campaign.

## Formula – How to calculate ROMI

Baseline Profit = Baseline revenue – Baseline Cost of Goods Sold

Marketing Campaign Profit = Revenue – Cost of Goods Sold

Profit with Marketing Campaign Cost = Profit – Marketing Cost

Campaign Uplift = Profit with Marketing Cost – Baseline Profit

Return on Marketing Investment = (Campaign Uplift / Marketing Cost) x 100%

### Example

Baseline Profit = \$25,000 – \$20,000 = \$5,000

Marketing Campaign Profit = \$50,000 – \$40,000 = \$10,000

Profit with Marketing Campaign Cost = \$10,000 – 3,000 = \$7,000

Campaign Uplift = \$7,000 – \$5,000 = \$2,000

Return on Marketing Investment = (\$2,000 / \$3,000) x 100% = 0.6667 x 100% = 66.67%