Calculating Return on Investment (ROI)

This formula expresses how to calculate ROI for a keyword or overall for your entire campaign. The model that we are currently working with is one where the end sale is not made online, but rather the lead is generated online. In this case I am using the model of a software company where a user can download a trial version of the software thus becoming a lead for the sales team to close.

What is ROI – Overall and Per Term
1000 Clicks/Visitors at $6.85 = $6,850
7% Convert to Leads
Total Leads = 70
Cost Per Lead = $97.86
6% Closed = 4 Sales
Total Cost of Lead per Sale $1,712.50
Average Sale Price = $3,500
Sales Overhead = $500
Total Cost of Sale = $2,221.50
Total Sale Cost – Average Sale Price = ROI
ROI Per Sale = $1,278.50 or 36%