ROI (Return On Investment)
ROI (Return On Investment) is the return on what you spent — the core profitability metric of a funnel. It shows how much you earned relative to spend.
The ROI formula
ROI = (revenue − cost) / cost × 100%. For example, $1500 revenue at $1000 cost — ROI 50%. Positive ROI means profit, negative means loss.
What to include in cost
Honest ROI counts everything: traffic buy, domains, service, fees. Counting only the ad budget overstates the picture.
FAQ
- How is ROI different from ROAS?
- ROI subtracts cost from revenue and divides by cost; ROAS is just revenue / ad spend, without subtracting cost.
- What ROI is considered good?
- It depends on vertical and risk, but steady positive ROI over time beats one lucky day.
- Why is ROI sometimes overstated?
- If domains, service and fees are left out of cost, real profit ends up below the calculated figure.
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