Exercises to calculate true ROI

Know Your Numbers.

Tired of not truly knowing your numbers when it comes to your marketing investments? Let's get real about ROI with these practical exercises that go beyond the basic formula.

Map your customer journey with attribution touchpoints. Before calculating anything, document every touchpoint where you spend money to acquire customers. For each channel, note whether it's primarily driving awareness, consideration, or conversion. This clarity prevents the classic mistake of attributing sales to just the final touchpoint.

Build a weighted attribution model. Assign percentage values to each touchpoint based on its contribution to the final sale. Pro Tip: Track 100 sales through their complete journey and calculate how often each touchpoint appears in successful conversions. This gives you a data-backed attribution model rather than guesswork.

Calculate your true customer acquisition cost (CAC). Add ALL costs: ad spend, agency fees, content creation, technology tools, and relevant team salaries. Divide by new customers acquired in that period. Most brands underestimate CAC by 30-40% by ignoring these supporting costs.

Factor in time-to-payback. How many repeat purchases does it take before you recover your CAC? Map customer purchase cycles to understand your cash flow reality. A channel with higher initial CAC but faster repeat purchases may outperform a cheaper acquisition source with lower retention.

Include opportunity cost in your calculations. What could you have done with that same budget? Run small experiments with alternative channels, then extrapolate results to understand what you might be missing.

Remember: true ROI isn't just about immediate returns but about building a sustainable acquisition model. When you accurately measure the complete picture, you make investment decisions that drive profitable growth rather than just impressive-looking conversion metrics.