Return on Investment (ROI)
01 Definition
Return on Investment (ROI) meaning: A measure of profit earned relative to the cost of an investment.
ROI divides the net gain from an investment by its cost, usually shown as a percentage. In marketing it compares profit from an activity to what it cost to run. Because inputs like time frame and attributed profit vary, ROI figures are only comparable when defined the same way.
Why it matters
How Return on Investment (ROI) fits the work
It is a common language for judging whether spending pays off, letting teams rank very different activities by their financial return.
In context
A campaign that cost 20,000 dollars and generated 10,000 dollars in net profit delivered an ROI of 50 percent.
Practical note
ROI depends heavily on how you count costs and profit, and it ignores timing and risk. Two people can compute very different ROIs for the same project.