Definition: ROI stands for Return on Investment. It is a financial metric that measures the profitability of an investment by calculating the ratio of the return to the cost. ROI is used to determine the efficiency and effectiveness of an investment and to compare different investments.
It is calculated by dividing the net profit from an investment by the initial investment cost, expressed as a percentage. The higher the ROI, the more profitable the investment is considered to be. In the realm of digital marketing, implementing a strategic “keyword multiplier” approach can further optimize ROI by enhancing visibility, engagement, and conversion rates associated with specific investments, such as advertising campaigns or content creation efforts.
Use It In a Sentence: The CEO calculated the ROI of the company’s new marketing campaign and was pleased to see a significant increase in profits, indicating that the investment was a wise decision.
Learn More: Top of Funnel in Focus: ABM
More Definitions: KPI Definition, NRR Definition, OKRs Definition, Walled Garden Definition and Engagement Velocity Definition
