Question 1

What is Marketing ROI?

Accepted Answer

Marketing Return on Investment (ROI) is a metric used to measure the profitability of a marketing campaign. It's calculated as `((Net Profit - Marketing Spend) / Marketing Spend) * 100`. A positive ROI means the campaign generated more profit than it cost.

Question 2

How do I calculate 'Sales Growth Attributed to Campaign'?

Accepted Answer

This can be tricky, but common methods include using unique discount codes, tracking clicks from digital ads through to purchase, or comparing sales figures during the campaign period to a baseline period before the campaign started.

Question 3

What is a good Marketing ROI for a restaurant?

Accepted Answer

A good ROI can vary, but a common benchmark to aim for is a 5:1 ratio, which translates to a 400% ROI. This means for every $1 you spend on marketing, you generate $5 in revenue. However, this depends heavily on your profit margin.

Question 4

Should I include labor costs in my 'Marketing Spend'?

Accepted Answer

If you have staff dedicated to marketing, you should ideally include the cost of their time in your marketing spend for a truly accurate ROI calculation. However, for a quick analysis, many businesses start by only including the direct ad spend or campaign cost.

Question 5

What if I can't directly track sales growth from a campaign?

Accepted Answer

For brand awareness campaigns (like a billboard), tracking direct ROI is difficult. In these cases, you might focus on other metrics like website traffic, social media engagement, or brand mentions to gauge the campaign's effectiveness, even if a direct dollar ROI isn't available.

Marketing Spend ROI Calculator

Results

Understanding Marketing Spend ROI

Frequently Asked Questions

Need Help Optimizing Your Hospitality Business?