What ROI means in marketing: the formula built on profit, not sales, worked examples with a 3,000 baht ad and a 500 baht boosted post (invented numbers), an ROI vs ROAS table, and the costs people forget to count.
ROI stands for Return on Investment: the return you get compared with the money you put in. In marketing it is calculated as (profit gained minus money invested) divided by money invested, times 100, giving a percentage. This article explains the formula, works through an ad and a boosted post in baht, compares ROI with ROAS, and points out the costs online shops often forget.
Key takeaways
- ROI is the return compared with the money invested, shown as a percentage
- Formula: (profit minus cost) / cost x 100; use profit, not sales
- ROAS is revenue per ad baht; ROI is profit per invested baht; they are not the same
- Sales must be several times the ad cost before there is any profit
What is ROI
ROI (Return on Investment) is the number that says how worthwhile the money you put in was. Positive ROI means profit beyond what you spent, zero is break-even, and negative is a loss.
In an online business the investment may be ad spend, a boosted post, a paid review or content production. The return is the profit that investment produced, for example sales from the ad after product costs are taken out.
NoteDefinition used here
ROI has several variants depending on the field. This article uses the basic formula common in marketing, built on profit. If your workplace uses another version, agree on the definition before comparing numbers.
ROI is one term in online marketing. For an overview of the related terms, read What Digital Marketing Is.
The ROI formula, step by step
The formula is short. The step people trip on most is step 1, where sales get used in place of profit.
ROI formula
Find the sales from this investment
For example sales from an ad link, a campaign-only discount code, or orders customers say came from that post. If you cannot count it exactly, estimate honestly and note how.
Subtract the costs of those sales
Product cost, packaging, shipping the shop pays, platform fees. The result is profit before ad spend.
Subtract everything you invested
Take profit before ad spend and subtract all the ad or promotion spend for that campaign.
Divide by the amount invested, then multiply by 100
The result is ROI as a percentage. Negative means the round has not paid back yet.
Worked example: a 3,000 baht ad
An invented example. A made-up bakery called Rainy Day Bakery runs a 3,000 baht ad. Every number here is invented to explain the idea; none of it is a real shop's result or a market average.
Ad spend 3,000 baht
Sales from the ad 12,000 baht
Product, packaging, shipping and fees together 60% of sales, which is 7,200 baht
Profit before ad spend: 12,000 minus 7,200 is 4,800 baht
ROI is (4,800 minus 3,000) divided by 3,000, times 100, so ROI is 60%. Every 1 baht put into the ad returned 0.60 baht of profit on top of getting the principal back.
WarningDo not use sales for profit
Put the 12,000 sales in place of profit and you get (12,000 minus 3,000) / 3,000 = 300%, five times too good because product cost was ignored. When you read someone else's ROI or an ad report, check whether it uses profit or sales.
How much sales before you stop losing money
The table keeps the ad spend at 3,000 baht and the 40% gross margin from the example above, then shows ROI at different sales levels. All numbers are invented.
Sales levels with a 3,000 baht ad
Scroll the table sideways to see the remaining columns
At 6,000 baht of sales ROAS is 2.0, which sounds fine, yet ROI is negative because the profit does not cover the ad. This shop's break-even is ROAS 2.5, found as 1 divided by the gross margin, 1 / 0.40.
TipEasy break-even rule
Break-even ROAS equals 1 divided by gross margin. At a 50% margin you need ROAS of at least 2.0; at 25% you need 4.0. Thin-margin products need sharper targeting.
To see how many of the people who visit end up ordering, look at the share in What Conversion Rate Is.
How ROI and ROAS differ
The two terms get mixed up often. ROAS stands for Return on Ad Spend: revenue or conversion value per unit of ad cost. Google Ads' help page on Target ROAS bidding describes it as conversion value per cost and gives an example target ROAS of 500%. Last checked Oct 2026.
ROI compared with ROAS
Scroll the table sideways to see the remaining columns
Use ROAS as a daily read because it is quick, then use ROI to judge whether a campaign truly paid off, with your shop's break-even as the bar. Ad reports usually show revenue, not profit, so always work out profit yourself.
Costs people forget when calculating ROI
An inflated ROI usually comes from missing costs. Run through this list before you conclude anything.
Real product cost, including damaged items and returns
Packaging and shipping the shop pays
Platform and payment fees
Images, video or paid reviews made for that campaign
Your own time; if you pay someone to help, that is a real cost
Marketplace sellers should check all fees first. The method is in the marketplace pricing and fees formula.
Example: a 500 baht boosted post
Another invented example. A shop boosts one post with a 500 baht budget. These numbers are invented too.
10 people message from the post, which is 50 baht per chat
4 buy at 350 baht each, 1,400 baht in sales
Costs are 60% of sales, leaving 560 baht profit before the boost
ROI is (560 minus 500) / 500 x 100 = 12%
A small profit, but not a loss. If those 4 customers buy again later the real return is higher, but only count that when you have real repeat-purchase data. Do not assume it.
Before boosting, see the boost post checklist, and if you are comparing per-1,000 prices, read what price per 1,000 means.
Working out ROI for a small shop in 5 steps
Say clearly what you are measuring
For example, how many orders did this ad produce. Pick a number you can really count.
Know the product's gross margin
Work out the margin after product cost before you start, then find break-even ROAS as 1 divided by gross margin.
Record spend and sales of the same campaign
Use the same period and separate by campaign or post instead of lumping everything together.
Calculate ROI and ROAS together
Check ROAS against break-even, then calculate ROI in real baht.
Decide from the numbers, then test again
If it pays, raise the budget a little. If not, fix the image, message or audience before adding money.
Results that are not immediate sales: can you measure ROI
Some work does not produce sales right away, such as awareness posts or growing followers. An exact ROI is hard because you cannot tell when or where each viewer will buy.
What you can do is choose a measure close to sales that you can count, such as chats, link clicks or emails collected, and work out cost per unit, for example 50 baht per chat. Then see what percentage of chats become orders. How to read social numbers and decide where to spend next is in reading social analytics to decide where to invest.
Check before calling an ad worthwhile
Done 0/5
For a shop just starting that wants a basic follower or like count on the account, Instafollow's service is one option. It does not guarantee sales, returns or any ROI, and follower numbers are not sales; always measure with real orders. See Instagram followers service or the free trial, available only for services open to trial.
ArticleReading Your Social Analytics to Decide Where to Invest, Not Where You Feel LikeA limited budget across many channels: let analytics make the call. Which numbers to check, when, and how to decide so every baht goes further.If you are about to try a boosted post
ArticleBefore You Boost a Post: 12-Point Go/No-Go ChecklistA 12-point checklist before boosting a Facebook or Instagram post, split into the post, the destination and the numbers, with 3 example decisions and what not to do before paying.And the service for your shop's Instagram account
ServiceBuy Instagram Followers, Likes & Reels ViewsGrow your Instagram with followers, likes, Reels views and comments. See the price per 1,000 up front, pay by PromptPay, and never share your password.ROI questions
What is ROI
ROI is short for Return on Investment: the return compared with the money invested, calculated as (profit minus investment) divided by investment, times 100, as a percentage.
What is a good ROI
There is no fixed number. It depends on the product's gross margin, the business and your goal. At minimum it should be above 0%, which means no loss, and high enough to justify the risk and time.
How do ROI and ROAS differ
ROI looks at profit against total money invested. ROAS looks at revenue against ad spend. A high ROAS does not always mean profit if product cost is high.
What does negative ROI mean
This round's profit did not cover the money invested. See what can be fixed, such as the image, message, audience or price, before adding budget.
Do I need ROI for every post
No. Start with posts or ads that cost real money. For ordinary posts, a simple measure such as chats received is enough.
Can a follower increase count as a return
Not directly as money. Followers are an awareness measure. To turn them into money you need real data on how many followers became orders.
Summary
ROI is the profit you got compared with the money you put in, built on profit rather than sales. ROAS is a fast read of revenue per ad baht that does not say whether you profited. Know your product's break-even ROAS, count every cost, and decide from your own shop's numbers.
