The essentials
- Formula: ROI = (margin generated by the advertising minus the full cost of the advertising) / full cost. An ROI of 0 means the advertising pays for itself; 1 means €1 of net margin for €1 invested.
- The full cost: media, provider or internal time, creative, measurement tools, platform fees; forgetting the provider overstates ROI by 15 to 30%.
- The gain: the margin (not revenue), net of returns and discounts, on the conversions attributed by a neutral source, including lifetime value if the business is recurring.
- 2026 benchmarks: ROI of 0.5 to 3 on Google search and Shopping, 0 to 2 on social advertising for acquisition, 2 to 6 on retargeting and email.
Return on investment is the figure that decides whether an ad campaign deserves its budget. Yet it is rarely calculated correctly: gross revenue is compared with media spend, the provider and the returns are forgotten, the conversions declared by the platform are taken as they stand. This article gives the formula, the elements to include, measurement by channel and by campaign, the 2026 benchmarks and the common errors. The general method is in how to calculate marketing ROI, and the definition of ROAS, often confused with ROI, in ROAS: definition.
The formula and what it contains
ROI = (gain attributable to the advertising minus full cost) / full cost. The result is expressed as a multiple or a percentage: an ROI of 1 (100%) means every euro invested returned a euro of margin on top of paying itself back; an ROI of 0 means the advertising paid for itself without returning anything; a negative ROI means a loss. ROAS, for its part, compares gross revenue with media spend alone: a ROAS of 4 with a 30% margin and 20% management fees gives an ROI close to 0.
| Element | To include in the cost | To include in the gain |
|---|---|---|
| Media (clicks, impressions) | Yes, by channel and by campaign | |
| Provider (agency, freelance) or internal time | Yes, pro rata by channel | |
| Creative (visuals, videos, copywriting) | Yes, spread over the period of use | |
| Tools (measurement, call tracking, connectors) | Yes, pro rata | |
| Attributed revenue | Converted into gross margin | |
| Returns, cancellations, discounts | Deducted | |
| Repeat purchases and lifetime value (recurring business) | Added over 12 months, cautiously | |
| B2B leads | Valued: close rate × average margin on a deal |
Measuring the gain: attribution
The gain depends on the conversions attributed to the advertising, and that is where the discrepancies are largest. Google Ads, Meta and TikTok each count the conversions preceded by a click or a view within their own window; the total exceeds reality by 30 to 80%. For ROI by channel, the source must be neutral: GA4 with data-driven attribution for B2C, the CRM for B2B, where each signed deal keeps its original source. Retargeting deserves separate reading: it claims sales prepared by other channels, and its apparent ROI is overstated; a test with a control group or a comparison of the click-only window gives a fairer figure. The useful reports are described in advertising performance in GA4.
A worked example
| Item | Google Ads search | Meta Ads acquisition | Meta retargeting |
|---|---|---|---|
| Monthly media | 3 000 € | 2 000 € | 500 € |
| Provider and creative (pro rata) | 600 € | 700 € | 100 € |
| Full cost | 3 600 € | 2 700 € | 600 € |
| Attributed revenue (GA4, returns deducted) | 16 000 € | 7 500 € | 3 000 € |
| Gross margin (35%) | 5 600 € | 2 625 € | 1 050 € |
| ROI | 0,56 (56 %) | minus 0.03 (minus 3%) | 0,75 (75 %) |
| ROAS displayed by the platform | 6,2 | 5,1 | 11,4 |
With the platform ROAS figures alone, all three campaigns look profitable and retargeting looks like the best. With the full ROI, Meta acquisition loses money directly (it can be justified by repeat purchases or awareness, provided that is measured), and Google Ads remains the safest channel. This calculation by channel is done each month and read over the quarter.
2026 benchmarks
- Google search and Shopping: ROI of 0.5 to 3 depending on margin and competition; brand queries push the average up and must be isolated.
- Social advertising for acquisition: ROI of minus 0.3 to 2 directly; positive mainly with lifetime value and on high basket values.
- Retargeting: apparent ROI of 2 to 6, real ROI of 0.5 to 2 once incrementality is measured.
- Email to an existing list: ROI of 3 to 10, the highest, but limited by the size of the list.
- B2B (Google Ads, LinkedIn): ROI of 0.5 to 4 over 12 months, with a delay of 3 to 9 months before the deals sign; the KPIs are detailed in the KPIs to prioritise in B2B.
The errors that distort ROI
- Comparing revenue with media spend: that is a ROAS, not an ROI; margin and ancillary costs change the conclusion.
- Taking the platforms' conversions: they overlap and include view-through.
- Forgetting returns: 10 to 30% in fashion; an ROI calculated on gross sales is wrong.
- Ignoring the delay: a B2B lead generated in January signs in April; January's ROI looks negative and April's excellent.
- Mixing brand and prospecting: campaigns on the company name have a very high ROI that masks the ROI of prospecting.
- Not measuring calls: in services, 30 to 60% of conversions are calls; without call tracking, ROI is understated.
- Stopping after the first month: bidding algorithms need 4 to 6 weeks to stabilise; ROI is judged over the quarter.
Organising the measurement
Four prerequisites: the conversions configured in GA4 with their value (or an average value by lead type), the link between GA4 and Google Ads described in connecting GA4 to Google Ads, the monthly import of the full costs (provider, creative, tools) into the dashboard, and reconciliation with the e-commerce platform or the CRM for margin, returns and signings. ROI is then calculated by channel and by campaign in a single table, with the platform ROAS as a control column to measure the gap. The arbitration thresholds are detailed in steering your marketing budget with KPIs.
How GreenRed helps
Rather than juggling several tools, GreenRed's return on investment module brings these metrics together in a single dashboard, compares them over time and tells you which actions come first. You can try it free, with no card, from the Pricing.
Frequently asked questions
How do you calculate the ROI of an online advertising campaign?
ROI = (margin generated by the conversions attributed to the advertising minus full cost) / full cost. The full cost covers media, the provider or internal time, creative and tools; the gain is the gross margin net of returns, on conversions attributed by GA4 or the CRM, not by the platform.
What is the difference between ROI and ROAS?
ROAS compares gross revenue with media spend alone; ROI compares net margin with the full cost. A ROAS of 4 with a 30% margin and 20% management fees gives an ROI close to zero. ROAS is used to optimise inside the platform, ROI to decide the budget.
What is a good advertising ROI in 2026?
A positive ROI over the quarter, full costs included. The benchmarks are 0.5 to 3 on Google search and Shopping, minus 0.3 to 2 on social advertising for acquisition, 0.5 to 2 on retargeting once incrementality is measured, 3 to 10 on email to an existing list.
How do you calculate ROI when the sales happen offline?
By valuing the leads: number of leads attributed to the campaign × close rate × average margin on a deal, read in the CRM with the original source kept through to signature. The delay between the lead and the signature calls for a reading over 6 to 12 months.
Should customer lifetime value be included in ROI?
Yes for recurring businesses (subscription, consumables, e-commerce with repeat purchase), with a 12-month value calculated from real history and not from an assumption. Without it, acquisition looks loss-making when it is profitable; with an overstated LTV, you fund campaigns that lose money.