Reference Point - Google.com article click to read... Return on investment (ROI)
How much profit you've made from your ads compared to how much you've spent on those ads.
To calculate ROI, take the revenue that resulted from your ads, subtract your overall costs, then divide by your overall costs: ROI = (Revenue - Cost of goods sold) / Cost of goods sold.
Let's say you have a product that costs $100 to produce, and sells for $200. You sell 6 of these products as a result of advertising them on Google Ads. Your total sales are $1200, and your Google Ads costs are $200. Your ROI is ($1200-($600+$200))/($600+$200), or 50%.
To help measure your Google Ads ROI, you'll need to track conversions, actions that you want your customers to take on your website after clicking your ad such as a purchase, sign-up, or download. Try conversion tracking or Google Analytics, free tools to help you track conversions in your account.
ROI is typically the most important measurement for advertisers because it shows the real effect that Google Ads has on your business. While it's helpful to know the number of clicks and impressions you get, it's even better to know how your ads are contributing to the success of your business.
Do Google Ads Campaigns Really Work?
When set up and managed correctly, then businesses can see strong return on investment from Google Ads, as indicated by the following stats:
Businesses make an average of $2 in revenue for every $1 they spend on Google Ads. (Google Economic Impact Report)
72% of Google Ads marketers plan to increase their PPC budgets (Search Engine Watch). This is a strong indication that those businesses were generating positive ROI, because if they were not, then they wouldn’t increase their budgets.
70% of mobile searchers call a business directly from Google Search. (Expandedramblings.com)
70% of mobile searches result in action being taken within an hour. (Mediative Labs)
Of course, there are a lot of factors that determine the success of a Google Ads campaign so these stats should not imply that every ad campaign will be profitable. The reality is that you must set up and manage your ads correctly to see positive results.
Are My Customers Really Using Search Engines To Make Buying Decisions?
Let’s take a look at some key stats:
86% of consumers use the Internet to find a local business (WebVisible survey)
72% of consumers prefer to find information on local merchants via search. (WebVisible survey)
29% of consumers search for local businesses at least every week (BrightLocal survey)
Why Use Google Ads Versus Bing Ads?
I’ll let the stats speak for themselves here:
Google owns 71% of the search market share. (Netmarketshare.com). This stat alone answers the question, but we won’t stop at just search. Here are some stats about Google’s Display network…
Google owns the world’s largest online display advertising network. (comScore)
Google display campaigns reach 80% of global internet users. (Google Benchmarks and Insights)
Consumers exposed to display ads are, on average, 155% more likely to search for brand- and segment-specific terms. (Specific Media)
Before we move on, here’s one more stat that is important to understand:
About 97% of Google’s total revenues come from advertising. (Google Investor Relations)
Why is this stat so important? It highlights the importance of Google Ads to Google’s business. Since Google depends so greatly on Google Ads, that means Google’s focus and priority is on maintaining and continually improving the Google Ads tool set. This is important, especially today when we see so many complaints about Bing Ads support.
LinkedIn Ads ROI
Reference Point – LinkedIn.com article click to read...
Digital marketers deliver tremendous impact to their businesses. In order to more effectively highlight this impact, digital marketers can start measuring ROI over a longer timeframe. Through a global survey of 4,000+ digital marketers, LinkedIn uncovers how measuring ROI over the length of the sales cycle can lead to more accurate reporting, greater marketer confidence, and improved campaign management.
Facebook Ads ROI
Reference Point – LinkedIn.com article click to read...
Facebook has become an integral part of the marketing process. More than 1.71 billion people visit it on a monthly basis, making it the third most visited website globally. Every business has at least contemplated establishing a Facebook presence. For some, the social network might not be the right fit, but for millions of others, it’s a must.
What Is Facebook ROI?
Facebook ROI is what your company gets back from the time, money and other resources you’ve put toward social media marketing on the platform. ROI isn’t the same for everyone. How it’s defined for you will differ between other companies based on your specific business goals
Youtube Ads ROI
Reference Point – neilpatel.com article click to read...
The social media giant has over 2 billion users and people are watching 50% more video on the platform year over year.
For marketers and small business owners, this represents a huge opportunity to get in front of a target audience.
Because the YouTube ad format relies solely on video, the platform can seem a little daunting at first.
Twitter Ads ROI
Reference Point – twitter.com article click to read...
Independent research shows Twitter marketing campaigns can deliver 40% higher return on investment compared to other media channels.
Pouring money into marketing can often feel like an act of faith. Your gut tells you when a campaign is working, but the metrics to prove that are sometimes a little fuzzy. Marketers are often skeptical about the claims made by media outlets, and rightly so.
Snapchat Ads ROI
Reference Point – businessinsider.in article click to read...
Nykaa, an online beauty and wellness e-commerce platform, wanted to expand its user base in India and tap into a new set of audience. That’s when the brand decided to partner with Snapchat for a 360-degree performance campaign.
The aim of the campaign was to deliver positive ROI for every dollar they spend on our platform and we managed to deliver 9X the purchase volume for every dollar they spent with us. They also wanted to increase app downloads, so we were able to exclude users who already had Nykaa’s app installed and then built a look-alike segment of their existing users who fitted with Nykaa's user profile which boosted their overall install rates in India,” shares Tarika Soni, Head of Commercial Strategy and Ad MonetizationIndia.
Yahoo Bing Ads ROI
Reference Point – wordstream.com article click to read...
7 Ways Bing Ads Beat Google Ads
It’s the most exciting time of the year at WordStream – annual revenue reports! But we’re not the ones excited about it; the search giants all released their annual revenue reports earlier this month. If you missed the excitement in it all, you can catch all the juicy details here for Google, Microsoft, and Yahoo! A quick glance paints a good picture for all 3 companies, but Microsoft proved to have the greatest picture of the three, celebrating a 23% year over year growth in search advertising.
Determining Your Instagram Ad Cost Per Click & Is It Worth It?
71% of U.S. businesses are now on Instagram. 65% of the top performing posts center around a brand. 80% of users follow businesses. As a business today, Instagram is the place to be, especially when you consider the 800 million active users on the platform.
Own a day with a cross-platform promotion. Pin your logo and tagline to the top of the dashboard for 24 hours. It links to an exclusive tab in the Explore page - one of the most trafficked and engaging pages on Tumblr - filled with content you've selected. You can use your own posts, reblog posts you like, or do a mix of both. Whatever story your brand wants to tell, you've got a slice of the dashboard to tell it in all day long.
How ROI is calculated
Return on investment (ROI) allows you to evaluate how much your advertising spending pays off. ROI is the ratio of return on advertising to money spent on advertising:
As a business metric, you can use:
Revenue from product sales
Profit: revenue minus cost
Any other indicator characterizing return on advertising
For example, over a month you spent 5,000 rubles on advertising a product, while the total cost of the product sold (excluding advertising expenses) is 13,000 rubles and the sales revenue is 20,000 rubles. According to the formula above, the ROI calculated from revenue is: