How do you calculate marketing ROI?

Marketing ROI is net return divided by marketing cost, expressed as a percentage: take the revenue attributed to marketing, subtract the marketing cost, divide the result by that cost, multiply by 100. Revenue of 120,000 against a cost of 30,000 gives a net of 90,000 and an ROI of 300 percent. The hard part is not the formula — it is agreeing what counts as attributed revenue and whether salaries are inside the cost figure.

What is the difference between ROI and ROAS?

ROAS divides gross revenue by cost; ROI divides net return by cost. The same campaign will show a 4x ROAS and a 300 percent ROI, and the ROAS figure will always look more impressive because it has not subtracted what you spent. Neither is wrong. Reporting one while your board assumes the other is what causes the problem.

Should LTV be calculated on revenue or gross margin?

Gross margin. Revenue-based LTV treats every dollar a customer pays as value to the business, which ignores the cost of serving them — hosting, support, payment processing. For a software company running at 75 percent gross margin, the revenue version overstates lifetime value by a third, and every LTV-to-CAC decision made on it is correspondingly wrong.

What should my LTV to CAC ratio be?

Three to one is the usual benchmark, but treat it as a band rather than a target. Below one you lose money on every customer you acquire. Between one and three you are viable but thin. Above five, the common reading is not that you are winning — it is that you are underspending on acquisition and leaving growth on the table.

What percentage of revenue should go to marketing?

Established B2B companies commonly run 5 to 10 percent of revenue; companies deliberately buying growth run well above it, and some categories with long sales cycles run below. The percentage is a sanity check, not a plan. The better question is what the next customer costs to acquire and how many you want, which is a CAC calculation rather than a budget one.

Is my data sent anywhere when I use these?

No. Every calculation runs in your browser using JavaScript on this page. Nothing is transmitted to Strategic Pete or to anyone else, nothing is stored, and there is no email field standing between you and the result.

Marketing ROI Calculator | Free, No Email

What these calculators are for

Every number below is arithmetic a marketing leader should be able to produce on demand, and most cannot, because the inputs live in four systems and nobody has agreed which definition counts. The calculators are on this page, they run in your browser, nothing is sent anywhere, and there is no email gate.

The commentary under each one matters more than the arithmetic. A marketing ROI of 300 percent means nothing if the revenue in the numerator was going to arrive anyway, and an LTV computed on revenue rather than gross margin will flatter almost any subscription business into a bad decision.

Marketing ROI calculator

Enter what marketing produced and what it cost. ROI is the net figure; ROAS is the gross one. Both are shown, because different people in your business will ask for different ones.

Revenue attributed to marketing

Total marketing cost

Marketing ROI—

ROAS—

Net return—

ROI is net return divided by cost. ROAS is gross revenue divided by cost, which is why it always looks better — decide which one you are reporting before the meeting, not during it.

SEO ROI calculator

What organic search is worth per month, against what you are spending on it. Use the sessions you expect at the end of the engagement, not today’s.

Monthly organic sessions

Session to lead conversion rate, %

Value per lead

Monthly SEO spend

Monthly value—

Monthly ROI—

Payback—

Value per lead is close rate multiplied by average deal value. If you do not know your close rate, the honest output of this calculator is that you need to find it out first.

LTV calculator

Lifetime value on the gross-margin basis, which is the version a board will accept. Revenue-based LTV flatters every subscription business.

Average revenue per account, monthly

Gross margin, %

Monthly customer churn, %

Your CAC, optional

LTV—

Average lifetime—

LTV to CAC—

Three to one is the common benchmark for LTV to CAC. Below one you are buying customers at a loss; far above five you are usually underspending on growth, not winning.

Customer acquisition cost calculator

Fully loaded CAC — sales and marketing together, including salaries. Marketing-only CAC is a number that makes marketing look good and tells you nothing.

Sales and marketing spend, period

New customers won, same period

Monthly revenue per customer

CAC—

Months to repay CAC—

Use the same period for both inputs, and lag the spend if your sales cycle is long — a customer who closed in March was bought with January’s budget.

Marketing budget calculator

A starting point from revenue and ambition, not a rule. Established B2B companies commonly sit at 5 to 10 percent of revenue; companies buying growth run higher.

Annual revenue

Percentage of revenue to invest

Annual budget—

Monthly budget—

If that figure looks impossible, the constraint is usually gross margin rather than appetite. Work the percentage down until the monthly number is one you would actually sign off.

CPM calculator

Cost per thousand impressions, for media planning and for checking a rate card you have been quoted.

Total media spend

Impressions delivered

CPM—

Impressions—

CPM measures delivery, not attention or outcome. It is the right question when you are comparing two placements and the wrong one when you are judging whether the campaign worked.

A marketing ROI calculator, and five more, free and ungated on this page