Tag: return on investment

Social Media ROI

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Marketers are always taught to seek out the Return on Investment on a certain campaign. The CEO wants to see numbers, they want to see the how much of a profit they would receive. Unfortunately, digital marketing cannot provide an actual ROI. When a campaign is created, usually the objective is building brand awareness and increase brand loyalty to its consumers. These steps will in turn increase the customer lifetime value of that consumer. It is hard to attach a monetary value to a campaign when we would need to evaluate the lifetime value of a particular customer. The way to accurately calculate Social Media ROI is to look at certain KPIs such as, total number of views, total numbers of clicked ads, and even total number of followers. All of these values can provide you a better understanding of how long a consumer will engage, purchase your product and build that brand loyalty.

What’s Up with My Investment ?

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In the business world, we want to make money. Money, Profit, Revenue, Dollar, Dollars, Bills Yall. Any entrepreneur or CEO of a major corporation has the goal of growing their business, gaining a larger Market Share, and improving customer life time value. With the money, time and effort that they have invested with in a company, they want to see results. These results are the Return on Investment (ROI). This value is calculated by the following equation. The ROI is usually expressed as a percentage.

ROI_Equation

The above photo was taken from (https://theonlineadvertisingguide.com/glossary/roi/)

For example, as a CEO I spent $500 to build my clothing business within two weeks I gained a total of $2000 from sales of basketball shorts. What is my ROI?

(2000-500/500) x100= 300%

In the above example I received a 300% ROI in my business. Which is great! These results are what CEO’s want to see. They want to see a higher revenue then what they invested.