Acronyms Dictionary
ROI
Definition
Return on Investment. A performance measure used to evaluate efficiency or profitability.
Deep Dive
ROI is the most fundamental metric in business. It calculates the benefit (return) of an investment relative to its cost. A positive ROI means the investment made money, while a negative ROI means it lost money.
Examples & Use Cases
- 1Calculating that a $5,000 ad campaign that generated $15,000 in profit has a 200% ROI
- 2Measuring the ROI of hiring an AI agent (Cost of Agent vs. Salary of Human Employee)
- 3Using ROI to prioritize which marketing channels to invest more heavily in
Related Terms
ProfitKPIMetrics