ROI Calculator for Advertising
Calculate the real return on your ad campaigns. Unlike ROAS, ROI deducts the cost of goods and shows whether each dollar invested generates profit or a net loss.
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ROI calculators by platform
Each platform has its own attribution logic, costs and benchmarks. Choose yours for a more precise analysis.
How ROI is calculated in advertising
ROI (Return on Investment) in digital advertising measures the real profit generated by a campaign relative to what you invested. Unlike ROAS, which only compares revenue to spend, ROI deducts the cost of goods to reflect whether you are actually making money.
Advertising ROI formula
ROI = ((Revenue × Gross margin) − Ad spend) ÷ Ad spend × 100
Example: you spend $500, generate $2,000 in revenue with a 35% margin.
Gross profit = $2,000 × 0.35 = $700 · Net profit = $700 − $500 = $200 · ROI = $200 ÷ $500 × 100 = 40%
ROI vs ROAS: the difference that changes everything
The most common mistake in ecommerce is confusing ROAS with ROI. ROAS tells you how much revenue each ad dollar generates, but it knows nothing about your costs. A campaign with 3x ROAS can be profitable or ruinous depending on your margin.
| Scenario | ROAS | Margin | ROI |
|---|---|---|---|
| High-margin product | 3x | 50% | +50% |
| Mid-margin product | 3x | 35% | +5% |
| Low-margin product | 3x | 25% | −25% |
The same 3x ROAS produces three completely different outcomes. Without knowing your margin, ROAS is useless for decision-making.
What ROI is good by platform?
There is no universal "good" ROI. It depends on the channel, product margin and purchase cycle. Here are reference ranges for ecommerce:
| Platform | Typical ROAS | Healthy ROI (40% margin) |
|---|---|---|
| Google Shopping / PMAX | 4–8x | 60–220% |
| Meta Ads (Facebook/Instagram) | 2–5x | −20% – +100% |
| TikTok Ads | 1.5–4x | −40% – +60% |
| Amazon Ads | 3–6x | 20–140% |
| Pinterest Ads | 2–4x | −20% – +60% |
What to do if ROI is negative
A negative ROI does not always mean pausing the campaign immediately. First identify which lever has the most room for improvement:
- →High CPC: improve CTR with more relevant creatives, adjust bids by segment or exclude low-converting audiences.
- →Low conversion rate: review the landing page (speed, value proposition, checkout), ad-to-page coherence and the offer.
- →Insufficient margin: raise average order value with bundles or upsells, or reduce COGS. Margin is the ceiling of possible ROI.
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ROI Guides
Is your ROI negative?
Read the guide on how to improve ROI to identify which lever has the most impact for your situation.
Read the guide →