A mini-calculator company saw its sales decrease over the last year and decided to launch a new marketing mix strategy to boost awareness and sales. One of the company's implemented tactics was to sell its mini-calculators through Amazon. It spent $5,000 to add new colors to their product offerings and $5,000 launching a video ad campaign. After tracking its online sales metrics, it saw a leap in sales of $20,000 in three months. What is this company's ROI on their marketing efforts?

Question

Essence Garner

Business

26 October, 07:58

A mini-calculator company saw its sales decrease over the last year and decided to launch a new marketing mix strategy to boost awareness and sales. One of the company's implemented tactics was to sell its mini-calculators through Amazon. It spent $5,000 to add new colors to their product offerings and $5,000 launching a video ad campaign. After tracking its online sales metrics, it saw a leap in sales of $20,000 in three months. What is this company's ROI on their marketing efforts?

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Answers (1)

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Elisha Prince · Answer 1

The ROI is 2

Explanation:

For computing the ROI we have to apply the formula which is shown below:

= Return in terms of benefit : investment

where,

Return is in terms of sales which equals to $20,000

And, the investment equals to

= New color cost + video launching cost

= $5,000 + $5,000

= $10,000

Now put these values to the above formula

So, the answer would be equal to

= $20,000 : $10,000

= 2