How To Accurately Calculate Your ROI For Digital Ads

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ROI

Key Takeaway:

To accurately calculate digital ad profitability, you must look past basic platform dashboard metrics:

  • The Problem with ROAS: Return on Ad Spend ($Revenue / Ad Spend$) only measures top-line revenue against direct ad costs. It ignores your real business overhead.

  • The ROI Formula: True Return on Investment requires factoring in all hidden expenses:

ROI = [ Net Revenue – ( Ad Spend + Cost of Goods Sold + Agency/Management Fees ) / Total Marketing Investment ] x 100
Calculating net profitability instead of raw dashboard conversions prevents budget bleeding and ensures your paid campaigns are actually generating net cash.

Have you ever looked at your digital marketing report, seen an impressive ROI, and felt that something was off? 

You can’t just go by what you’re told.

First off, ever-tightening privacy laws mean digital ad results from Google or Facebook may be off as much as 15%. 

Secondly, some agencies may give you your results without any context. 

And those numbers on their own don’t tell the whole story.

Our latest video dives deep into the truth behind ROI.

We tell you what fees you have to subtract to calculate your real ROI, why privacy laws are making this more difficult, and a simple way you can improve your Return on Investment.

Are you looking for an agency that values transparency and provides accurate ROI calculations? Look no further. 

Contact Mediaura today to ensure you’re working with a team that is honest about your real ROI, how it’s calculated, and how to improve it.

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