ROI - What is it and how to calculate return on investment

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ROI (Return on Investment) is a key financial indicator used to evaluate the effectiveness of investments. It allows you to understand how profitable the investment was and helps you make informed decisions about budget allocation. In this article, we will look at what ROI is, how to calculate it, and how to use it to analyze business results.

What is ROI?
ROI is a metric that measures the hong kong whatsapp data on investment. The indicator shows how much profit you received for each unit invested (for example, a ruble or a dollar).

ROI is used in a variety of areas, including marketing, sales, operations, and even personal investing.

ROI Calculation Formula
The basic formula looks like this:

ROI = (Return on Investment – ​​Investment Cost) / Investment Cost × 100%

ROI calculation example
Let's imagine that you invested 100,000 rubles in a marketing campaign that brought in 150,000 rubles in revenue. Let's substitute the values ​​into the formula:

ROI = (150,000 – 100,000) / 100,000 × 100% = 50%

This means that your investment has brought in 50% profit.

Why is ROI important?
Efficiency assessment. The indicator helps to understand how justified the invested funds are.
Investment comparison. ROI allows you to compare the profitability of different projects or campaigns.
Budget planning: Knowing your ROI allows you to allocate funds to areas that bring the greatest return.