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What is the Return on Marketing Investment (ROMI) when you spend $5,000 on advertising and generate...

What is the Return on Marketing Investment (ROMI) when you spend $5,000 on advertising and generate an increase in sales of $10,000 on a product with a gross margin of 60%?

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Answer #1

Return on marketing investment can be calculated by the following formula:

Increase in Sales = $10,000

Gross Profit Margin = 60%

Adveritising Cost = $5000

Substituting the values in the above formula:

Return on Marketing investment is 20%

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